> Someone figured out that the new tariffs are just our trade deficit with that country divided by the country's exports.

Note that the White House has both (1) officially denied this, (2) provided the formula they assert was used as support for that denial; but the formula is exactly what they are denying but with two additional globally-constant elasticity factors in the divisor, however, those elasticity factors are 4 and 0.25, so...

To give further evidence that they don't know what they're doing, it's easy to generate this tariff plan using a fairly simple LLM prompt that gives back that same ratio:

https://bsky.app/profile/amyhoy.bsky.social/post/3lluo7jmsss...

Who needs more evidence?

I watched the man with my own eyes as he seriously floated the idea of injecting disinfectants to treat Covid-19. That was five years ago. His mental faculties have not improved since then.

It's even worse, into the calculation they only counted goods, not services (where the US typically runs a large trade surplus).

Yes. These are College Freshman Essay economics, where you know just enough to declare it's time to go bold and are still stupid enough to believe it will work.

It's not that there's no strategy, it's that it was designed by reckless amateurs who haven't done the reading, haven't consulted with anyone that understands all the trade-offs, and have an uncapped appetite for risk.

The TV version works out perfectly, since the writers control the ending.

It's not: in the formula they posted, phi is the "passthrough from tariffs to import prices". That's where the country's own tariffs are factored in. Or am I reading this wrong?

What about Australia? We’re in surplus. Is 10% just the minimum?

Have you considered the possibility that they know perfectly well what they're doing and they're just lying about it? Lutnick, the commerce secretary, has been CEO of Cantor Fitzgerald for over 2 decades. The treasury secretary has a similarly stellar resume. There is no way these people don't understand the difference between expressing a trade deficit as a ratio and actual tariffs laid by other countries.

Trump personally may or may not understand it (I think he does) but his political superpower is his willingness to stand up in public and say complete bullshit knowing that it's bullshit, knowing that some people are fools who will uncritically believe the bullshit, and other people are cynics who who will nod along with the bullshit either to make money out of the rubes or because they think it serves a strategic purpose.

You can waste years wondering which side of Hanlon's razor someone is on, but it's important to remember that obsessing over such dilemmas can lead to paralysis. Just like there are a lot of street hustles and cons that depend on confusing/misleading the mark before tricking or mugging them out of their money, there are a lot of political gambits that depend on inducing analysis-paralysis in opponents. Manufacturing dilemmas is also a key element in military strategy.

My advice is to stop worrying about whether these people are such fools that you owe them some sort of empathy and an effort to save them from themselves, or you will end up like Charlie Brown having the football pulled way by Lucy yet again. It is OK to cut them off and treat them as bad actors, for the same reason you should often round off quantitative values instead of obsessing over precision.

Does the exact percentage of the tariffs matter? I suspect it doesn't - these look like approximate numbers to obtain concessions, and a complex formula doesn't really help anything.

Far as I can tell, the ideal would have been to simply double incoming tariffs, but that would be infeasibly large. This was a way to generate a plausible smaller number that can be increased later on an individual basis depending on how the country responds.

So I'm guessing it's not important to tariff the penguins of Antarctic Island?

I think the Trump Crime family shorted the market last week and made millions today and this week

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