Given that tariffs last year raised the import costs of Chinese goods roughly 6 percent on average, if Chinese firms had cut prices to offset Trump’s tariffs the index would have fallen 6 percent since last June — when the trade war started. Yet the index has fallen barely 1 percent, and at least some of that tiny decline can be explained by Chinese currency depreciation — which makes Chinese goods cheaper for U.S. importers. There is, therefore, no evidence supporting Navarro’s claim. Americans are, in fact, bearing the burden of Trump’s China tariffs.
Trump’s second claim is that tariffs are “filling U.S. coffers.” China tariffs, recall, were allegedly bringing in “hundreds of billions of dollars.” Yet this, too, is false. Government data show that they netted just over $8 billion in 2018. Extrapolating forward through the end of May, total revenue from Trump’s China tariffs has therefore been about $20 billion — a small fraction of what the president asserts.
More important, as of May, Trump has authorized nearly $26 billion in compensation to U.S. farmers for the losses they have suffered to date from Chinese retaliatory actions. This compensation is $6 billion more than the total estimated China tariff revenue. Far from “filling U.S. coffers,” then, Trump’s tariffs have been draining them at an accelerating pace.