Kelly
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Kelly
@kellycord.bsky.social
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amyhoy.bsky.social
guess where they got their weird trade deficit math from?

i went to the pit for y'all and brought back the screenshots with alt text
chatgpt log: What would be an easy way to calculate the tariffs that should be imposed on other countries so that the US is on even-playing fields when it comes to trade deficit? Set minimum at 10%. Reasoned about trade tariffs and deficits for 10 seconds v A straightforward (if naïve) method is to set the tariff rate for each trading partner equal to the percentage share of the trade deficit relative to that country's total imports-always no less than 10%. In formula form: Tariff Rate (%) = max(10, (Trade Deficit ÷ Total Imports) * 100) For example, if the US runs a $20 billion deficit on $100 billion worth of imports from a country, the calculated rate is (20/100)×100 = 20%. If the deficit were only 5%, you'd still impose a 10% floor. This method ignores the intricate dynamics of international trade-such as elasticities, retaliatory measures, and supply chain nuances-but it provides a blunt, proportional rule to "level the playing field." One might implement it in Python like so: [code] Gemini answer: Okay, let's break down the idea of using tariffs to achieve an "even playing field" defined as eliminating the US trade deficit. While the goal of balancing trade is understandable, devising an "easy way" to calculate tariffs to achieve this is extremely complex, and most economists would argue it's not feasible or desirable for several reasons. However, let's outline a highly simplified conceptual approach based only on the numbers, ignoring the vast real-world complexities and consequences: Simplified (and Problematic) Calculation Idea: 1. Identify the Bilateral Deficit: Determine the trade deficit the US has with a specific country (Country X). Deficit_X = Value of Imports from X - Value of • Exports to X 2. Target Reduction: The goal is to reduce imports from Country X (or increase their cost to US buyers) by the amount of the deficit, so that the value effectively balances out. 3. Calculate Required Tariff (Ignoring Economics): • If you assume, very unrealistically, that a tariff directly reduces the value of imports by a corresponding percentage (which it doesn't - it increases the price), you could try: Required Reduction % = Deficit_X / Value of • Imports from X Claude: What would be an easy way to calculate the tariffs that should be imposed on other countries so that the US is on even-playing fields when it comes to trade deficit? Set minimum at 10%. To calculate tariffs that could theoretically level the playing field for trade deficits, I'd suggest a straightforward approach based on the trade imbalance percentage: 1. Calculate the bilateral trade deficit with each trading partner: Trade Deficit - US Imports from Country - US Exports to Country 2. Express this as a percentage of total bilateral trade: Deficit Percentage - (Trade Deficit / Total Bilateral Trade) × 100 3. Apply a tariff rate that corresponds to this percentage, with your minimum 10% floor: Tariff Rate = max(Deficit Percentage, 10%) This creates a proportional response where countries with larger trade surpluses with the US would face higher tariffs. For example: • If Country A has a 25% trade surplus with the US (meaning the US has a 25% deficit), apply a 25% tariff • If Country B has a 5% trade surplus with the US, apply the minimum 10% tariff This method is relatively simple to calculate and directly ties tariff levels to trade imbalances. However, I should note that economists generally caution that trade deficits alone don't necessarily indicate unfair trade practices, and tariffs can have complex economic consequences including increased consumer prices and potential retaliation. Would you like me to elaborate on any part of this approach or discuss potential refinements to make it more sophisticated? Grok: the deficit. The deficit as a percentage of total trade is $295B/$582B = 50.69%. Using the formula Tariff% = 10% + (Deficit% × Scaling Factor), we choose a scaling factor of 50 for illustration: • Tariff = 10% + (50.69% × 50) = 10% + 25.345% = 35.345%, rounded to 35.3%. This means a 35.3% tariff on Chinese goods could be proposed to offset the imbalance, aiming to reduce imports and encourage domestic production or exports. Extending to Other Countries To provide a broader view, here's a table of top US trading partners with 2024 deficits, using data from The Motley Fool and similar calculations (assuming scaling factor of 50 for consistency): [data table headings] Country Deficit (USD Billion) Total Trade (USD Billion) Deficit % Calculate d Tariff % China -295 582 50.69% 35.3% Mexico -172 840 20.48% 20.2% Vietnam -123 (Data incomplet e, estimate) ~30% 25.0% Ireland -87 (Data incomplet e, estimate) ~25% 22.5% Germany -85 (Data incomplete estimate) ~20% 20.0%
April 3, 2025 at 12:42 AM