(AURN News) — The U.S. collected nearly $200 billion in tariffs last year, according to a recent must-read article by Wall Street Journal reporter Richard Rubin. But even with record revenue, the fiscal math isn’t adding up.
In an interview with AURN News, Rubin said tariffs are a consistent source of revenue, but not enough to replace income taxes. “We’re nowhere close to that,” he said.
“Tariffs are about three to four percent of federal revenue for fiscal 2025 and the individual income tax is like 51 percent. So just apples and oranges for now,” he added.
He also noted that while the Trump administration has floated the idea of shifting from income-based taxes to tariffs, “the strain on consumers isn’t part of what we looked at this week, but it’s real. Those tariff costs show up somewhere.”
The Department of Government Efficiency, or DOGE, was launched earlier this year with the goal of cutting waste and streamlining agencies. Rubin’s article shows that while it may have delivered on efficiency, it did not deliver the amount of savings promised.
“As important and large and substantial as DOGE was, and still is, because they’re still working on stuff, spending is controlled by Congress,” Rubin said. “So Congress gets to come along and say, ‘Here’s what each agency should have for fiscal year 2026.’”
Rubin said the largest costs — Social Security, Medicare, Medicaid and interest on the debt — are politically and structurally difficult to control. “The U.S. fiscal situation is unsustainable,” he said.
“The spending that we’re projected to do is out of line with the revenue we’re supposed to receive,” he said.
Still, he cautioned against panic, noting that the United States remains an economic powerhouse with global trust in its credit. “We have the world’s reserve currency,” Rubin said. “Despite all of the red ink, this is still economically a very strong country.”
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