2026-10-06 · contested story
Trade deficit hits $105.6 billion, widest since just before Trump tariffs enacted last year
In mid-February 2026, the Commerce Department reported that the U.S. trade deficit in 2025 narrowed only slightly to just over $901 billion from $904 billion in 2024 — a decline of just 0.2 percent — even as the deficit in goods, the only category tariffs actually apply to, widened 2 percent to a record $1.24 trillion. The data landed less than twelve hours after President Trump boasted on social media that his tariff regime had reduced the trade deficit by 78 percent, a claim National Review traced to 'cherry-picking of data between October and January.' The underlying story: despite the most aggressive tariff wall in decades (an effective rate near 17 percent, the highest since 1935 per the Yale Budget Lab), tariffs barely dented the overall balance of trade, while a NY Fed study found U.S. firms and consumers bore roughly 90 percent of the tariff cost.
How each side frames it
left
"There is no grand plan or strategic vision, no matter what his advisers claim — only the impulsive actions of a mad king."
"It's totally silly. There's no other way to say it, it makes no sense."
"the Trump tariffs are likely to end America's remarkable run of success and crash the economy, job growth and financial markets."
"Effectively, we're out of business. We can try to find more Canadian market share, but if many other beekeepers are trying to do the same, it may be a race to the bottom."
"the Center for American Progress estimates Trump's tariffs could cost American households an average of $5,200 every year."
center
"the gap the between the goods and services the U.S. sells other countries and what it buys from them narrowed to just over $901 billion, from $904 billion in 2024, but it was still the third-highest on record"
"Trump's tariffs are a tax paid by U.S. importers and often passed along to their customers as higher prices. But they haven't had as much impact on inflation as economists originally expected."
"the widening gaps with Taiwan and Vietnam might put a 'bulls eye' on them this year if Trump focuses more on the lopsided trade numbers and less on the US rivalry with China."
"Volkswagen, like most of its European peers, is under pressure from painful tariffs in the United States, falling sales in former cash cow China and aggressive Asian rivals entering the stagnant European market."
right
"the balance of trade has no bearing on a country's economic prosperity. The United States is one of the wealthiest countries in the world per capita, and it also runs the largest trade deficit."
"They've raked in more than $236 billion this year through November — much more than in years past, with one month still to go."
"companies have committed $9.6 trillion in investments tied to private companies and foreign partners, including multi‑year planned investments, according to PolitiFact."
"April 2, 2025, will forever be remembered as the day American industry was reborn, the day America's destiny was reclaimed, and the day that we began to make America wealthy again."
"Supporters of the tariff strategy point to the surge in federal revenue as a clear win."
What each side left out
The left left out — covered by the Newsmax & New York Post & National Review
- Record tariff revenue of $236B-$287B collected in 2025
- $9.6T in announced investment commitments
- Services surplus of ~$340B that offsets much of the goods deficit
The right left out — covered by the Center for American Progress & The Boston Globe & New York Post
- NY Fed finding that US firms/consumers bore ~90% of tariff costs (though NY Post, right-center, did cover it)
- Specific per-household cost estimates ($5,200/CAP)
- Economists' point that trade deficits reflect low US savings, not foreign cheating
The right left out — covered by the National Review & The Boston Globe & Boston Herald
- That the goods deficit — the only thing tariffs touch — hit a RECORD $1.24 trillion despite the tariffs (Newsmax/Fox emphasize the overall deficit falling instead)
The left left out — covered by the Boston Herald & New York Post
- That inflation did not rise as much as economists originally expected despite tariffs
The center left out — covered by the MSNBC & National Review & Center for American Progress
- Normative judgment on whether tariffs 'work' — AP wire deliberately avoids taking a side, so the moral/political debate is underdeveloped
What's actually true?
[verified] The overall US trade deficit narrowed slightly to just over $901 billion in 2025 from $904 billion in 2024 (about 0.2%).
[verified] The US deficit in goods trade widened 2% to a record $1.24 trillion in 2025, driven partly by chip imports from Taiwan.
[verified] A NY Fed study found US businesses and consumers bore about 90% of the cost of Trump's 2025 tariffs.
[verified] Tariffs raised more than $236 billion in revenue through November 2025 (calendar-year collections reached $287 billion), far above prior years.
[verified] The effective US tariff rate reached nearly 17% in November 2025, the highest since 1935 and roughly seven times January's level.
[contested] Trump claimed on social media the trade deficit had been reduced by 78% — a figure National Review attributes to cherry-picking October-January data.
[verified] The goods deficit with China plunged nearly 32% to $202 billion in 2025, while gaps with Taiwan and Vietnam rose sharply (trade diverted away from China).
[verified] The US services surplus rose to about $339-340 billion in 2025, offsetting part of the goods deficit.
The narrative clash
Whether tariffs reduced the trade deficit
Left: It reveals that the U.S. trade deficit declined by just 0.2 percent in 2025 — a far cry from Trump's figure — from $903.5 billion in 2024 to $901.5 billion last year. The deficit in goods, which are all that tariffs apply to, hit a record high in 2025.
Right: The U.S. trade deficit, meanwhile, has fallen significantly since the start of the year. The trade gap peaked to a monthly record of $136.4 billion in March... The trade gap narrowed to $52.8 billion in September
Who pays for the tariffs
Left: US businesses and consumers paid about 90% of the cost of President Donald Trump's sweeping tariffs last year — contradicting his repeated claims that foreign countries were footing the bill
Right: Billions of dollars, largely from countries that have taken advantage of the United States for many years, laughing all the way, will start flowing into the USA
What causes trade deficits
Left: It's not like the rest of the world has been ripping us off for decades. It's because we don't save enough.
Right: Trump trade adviser Peter Navarro calls America's trade deficits 'the sum of all cheating' by other countries.
40 sources analyzed
The Boston Globe Newsmax National Review New York Post New York Post Boston Herald The Boston Globe MSNBC Boston Herald The Washington Post New York Post The Boston Globe Fox News The Damage Report The New Republic The Telegraph Newsmax The Boston Globe Fox News PBS Newsmax Center for American Progress Fox News National Post New York Post NBC News Fox News Fox News Fox Business Politico AP News vox.com CBC Barron's The Daily Beast Semafor Newsmax CNN U.S. News & World Report Reuters