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Liberated? Despite Trump Tariffs, Steady Trade Deficit Jumped In July

The trade deficit rose sharply in July, hitting $1,063 billion on an annualized basis. That’s up from $854 billion in June. It’s the highest since the big import surge following Trump’s election, where people and businesses stocked up in anticipation of the Trump tariffs.

In the scheme of things, there is not any big problem with August’s deficit. It’s a bit more than 3.0 percent of GDP. We’ve had much larger deficits in prior years. The main factor driving the rise was a jump in imports of computer chips and other items needed for data centers. The data centers might be a problem, but the fact that the chips are imported is not an especially big deal.

However, this does matter in the world of Trump crazy, where countries are ripping us off if they are selling things we want. In that world, we are being ripped off by $110 billion more in August than July. If we look at the pattern of trade deficits over the last two and a half years, it doesn’t look like Trump is making much progress in his efforts to “liberate” us.

The trade deficit had been running at roughly an $850 billion annual rate through the first 10 months of 2024. It then soared immediately after the election and into the first months of 2025 as people and businesses rushed to buy cars, appliances, capital goods, and other durable goods in anticipation of Trump’s tariffs. The peak was a $1,596 billion annual rate in March of 2025, just before Trump’s big tariff announcement.

After “Liberation Day,” the trade deficit did fall somewhat, but this was largely the result of the post-election buying binge. People who bought a car in March of 2025 were not going to buy another one later in the year.

In more recent months, imports have been rising, pushing trade deficits well above their pre-election level. On the plus side, when the AI bubble bursts, we will see a big decline in our trade deficit.

Dean Baker is a senior economist at the Center for Economic and Policy Research and the author of the 2016 book Rigged: How Globalization and the Rules of the Modern Economy Were Structured to Make the Rich Richer. Please consider subscribing to his Substack, from which this is reprinted with permission.

Pollster Warns Furious MAGA Voters Want First-Term Trump Back — Or Else

MAGA pollster Rich Baris has interviewed countless Trump voters to get a gauge on Republicans’ chances in November. But standing in the way of salvation for Republicans is the fact that the 2024 version of Trump stinks.

“[I]f we're having an honest discussion, you could be a supporter of the president and you can still be honest. I don't just see what sycophants see: how that helps anybody. I mean, ultimately, it's my job to convey what people are telling me. And they wanted the old Trump back.,” said Baris, speaking with former George Bush speechwriter and Bulwark podcaster Tim Miller on Wednesday.

Baris said Michigan and Georgia are effectively locks for Democrats in the upcoming Senate race, and the outlook looks scary in many “safe” districts thanks to a declining Trump 2.0, which is nothing like the Trump of his first administration.

“People felt like,’ you know what? I think we might have had it a little bit better than we thought. Can we go back and have a redo?’ But this administration has not been a redo of 1.0 in many ways,” Baris told Miller.

Baris pointed out that his company releases a monthly summary report of what people tell them in interviews and a common theme keeps coming up over in every survey.

“And you could see it if you don't read the transcripts, the interviews, you could see in the word clouds, clear as day. They thought that the first Trump administration was much more focused on domestic policy. And Americans, they're not stupid. They know that the president's job has a lot [on its plate] but it's in the name right there: America First,” Baris said. “Look, I mean, I feel like I have a hard time speaking to some people on the right who are being intellectually dishonest with themselves. I mean, it's in the name, guys.”

Trump is a candidate and a two-time president who ran on “no new wars in the Middle East,” said Baris, and Trump’s voters very clearly plan to hold him to account on that. MAGA clearly loved what he was doing in the first three to five months in his second term, especially younger people, but that was a long time ago in terms of politics. Now, Republicans are running off the rails fast.

Trump’s economy, in the meantime, is in chaos thanks to tariffs and rising fuel and grocery prices.

“Republicans are going to run out of a coalition soon if they don't build on what he started to build in '24. And a lot of those gains are squandered because of the direction they took,” said Baris. “I mean, they decided by spring, certainly by summer, before Charlie [Kirk] was killed, to conduct Operation Midnight Hammer. And that was Kind of like a PTSD moment for a huge part of Trump's coalition.”

“They just thought, ‘here we go again. No, please.’ And they gave him a lot of grace and they waited and waited and waited, but he never took that pivot back to the domestic,” Baris added.

Reprinted with permission from AlterNet

As Trump's Power Wanes, Canadians Are Not Alone In Calling His Bluff

Oh good, another war. This time a trade war with Canada and for no other reason than ... what? To give Donald Trump a new stage for big-league bullying? To divert attention from the Jeffrey Epstein files? Who knows. Whatever. Trying to humiliate our closest ally does not serve American interests, ya think?

I say "trying" because Trump's powers are much diminished. Canadians are calling Trump's bluff, as are other countries and even some formerly supine Republican lawmakers. And it's getting harder to ignore the loose screws rattling around his head.

We won't go into the particulars of this latest trade dispute. Canada as well as the United States appeared to have thrown in last-minute demands. And Trump's new tariffs on $20 billion worth of Canadian goods affect only about 5% of Canada's exports to the U.S.

The bigger story here is the willingness of Canadian Prime Minister Mark Carney to defend his nation's honor even at a cost to his economy.

Moments after the tariffs went into effect, Trump recycled a golden oldie of abuse by posting on Truth Social, "Canada wants the benefits of being a State, without being one!!! They have also charged our great farmers, for many years, massive amounts of Tariffs. No More!!!"

About our great farmers, Trump has just lowered taxes on foreign beef in an obvious attempt to cut prices for steaks and hamburgers before the midterm elections. The higher prices were a godsend to American cattle ranchers already coping with wildfires, droughts and restrictions on shipments of young Mexican cattle to be fattened in U.S. feedlots.

"You don't put America first by putting U.S. cattle producers last," U.S. Cattlemen's Association President Justin Tupper said in response.

Trump keeps saying that the U.S. doesn't need Canadian products. But guess what his new round of tariffs doesn't include? Canadian oil or gas.

Talk of turning Canada into a state is perhaps Trump's most hostile assault on Canadian pride. Trump had referred to former Canadian Prime Minister Justin Trudeau as Gov. Trudeau. (He's quite the card.) He called the border between our two countries "an artificially drawn line" and said he would use "economic force" to make a takeover happen.

While visiting the Oval Office last year, Carney said that Canada "is not for sale" and "won't be for sale ever." Trump responded, "Never say never."

Over the weekend, Trump's first vice president, Mike Pence, provided a dose of sobriety. "American consumers pay American tariffs," he said. "My hope is, for the sake of American families and for the sake of the American economy, that what we're looking at here is negotiation and not confrontation in a trade war."

Though Trump's tantrums should fly over the northern border like bad weather systems that will pass, the abuse has long-term effects that have already come back to bite us. Against Trump's wishes, Canada is now doing its separate deals with China. He has threatened a 100 percent tariff on Canada over that.

A recent Angus Reid survey of Canadians found that more than 75 percent wanted Carney to hold his ground, even as 90 percent worried about economic costs. The Canadian pollster has also found that 79 percent of Americans still liked Canadians. But even if Canadians don't think Americans dislike them, the fact remains that the voters elected Trump twice.

Trump just said he'll tack 50% tariffs on vehicles and parts from Canada. A silver lining is that Trump's broadsides have become so unhinged, the prospects of his Republican enablers retaining that much power after November are much reduced.

Trump may be seeming more temporary, but in the meantime, we have another war, a ridiculous trade war.

Froma Harrop is an award winning journalist who covers politics, economics and culture. She has worked on the Reuters business desk, edited economics reports for The New York Times News Service and served on the Providence Journal editorial board.

Trump Foreign Policy Follies: South Korea Goes To The Shakedown Shack

President Trump’s latest move to downgrade U.S. involvement in long-planned military exercises with South Korea should make one thing very clear if it was not already. Under Donald Trump, the United States cannot be viewed as a reliable ally by anyone, except for Israel.

Trump has zero respect for the commitments of prior administrations or even treaty obligations. He doesn’t even care about his own commitments, as Canada and Mexico have discovered, as he freely ignores the trade agreement he negotiated in his first term. He does whatever he feels like.

For this reason, one can hope that South Korea was not surprised by Trump’s decision to downsize the joint military exercises with South Korea, as he announced his renewed friendship with Kim Jong Un. For folks with poor memories, Trump has repeatedly touted the “love letter” that the North Korean dictator sent him. He even stole the letter from the White House when he left office in 2021. (The letter is the property of the U.S. government, not Donald Trump.)

The story gets worse. Trump complained that South Korea refused to join the war that he and Israel started with Iran, even though he said he really didn’t need its help. Trump also again claimed the war was to keep Iran from having a nuclear weapon, even though no one in the world, except Trump, seems to think the country is anywhere close to having a nuclear weapon.

The irony of this gets even worse when we consider that Trump’s friend, Kim Jong Un, actually does have nuclear weapons, and likely has the means to deliver them to the United States. The Clinton administration had a multi-nation agreement designed to keep North Korea from getting nuclear weapons, which George W. Bush then abandoned.

There were efforts at a new agreement under Obama, but Trump quickly abandoned these after getting the love letter from Kim. This undoubtedly continues to be a great source of laughter in Pyongyang.

In addition to downgrading the military exercises, Trump also wants more money from South Korea for its defense assistance. On top of seriously overestimating the number of U.S. troops in the country (39,000 in Trump’s head, compared to 28,500 in reality), Trump apparently still has no understanding of the idea of collective defense.

If Trump wants to be able to project force against China, which may not be a good idea, but something he seems to want to do, then having an ally like South Korea is incredibly valuable. Just as the base in Bahrain, which Iran destroyed, was crucial for supporting Trump’s attack on Iran, the bases potentially provided by Korea would be of huge value in a military conflict. But this is a point that is likely too complicated for Donald Trump and his Fox News host Defense Secretary to understand.

Anyhow, the key takeaway for South Korea and the rest of the world is that the United States under Donald Trump cannot be counted on as an ally. And it would be very foolish for any country to view it as one.

Also, when it comes to trade, Trump’s commitments are absolutely meaningless. South Korea pledged $350 billion in investment in the United States in exchange for a modest reduction in the tariff rate that Trump imposed on imports from their country. Given the fact that Trump could raise his tariffs any time he feels like it, South Korea would be wise to keep its investment as a pledge. Only a fool would give something real in exchange for a Donald Trump promise.

Whatever tariff Trump ends up charging on our imports from South Korea is likely to have more to do with how he feels on a given day than any agreement between the two countries. As he continually tells the world, Trump does not care about his commitments. That’s the way he did business and the way he runs the country.

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Smart. Sharp. Funny. Fearless

Liberated? Despite Trump Tariffs, Steady Trade Deficit Jumped In July

Pollster Warns Furious MAGA Voters Want First-Term Trump Back — Or Else

As Trump's Power Wanes, Canadians Are Not Alone In Calling His Bluff

Trump Foreign Policy Follies: South Korea Goes To The Shakedown Shack

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