# The Effect of Tariffs After One Year Source: https://www.youtube.com/watch?v=zrAsxblDWvc Recap page: https://rapidrecap.app/video/zrAsxblDWvc Generated: 2026-02-06T14:37:40.59+00:00 --- ## Quick Overview Tariff revenue in 2026, projected to reach $7 billion by January 23rd across the first 15 business days, is already dramatically outpacing net tariff revenue from previous years, yet the speaker argues this amount is too small to significantly impact the federal deficit or individual tax burdens, concluding that tariffs are effectively a political tool rather than a meaningful fiscal lever. **Key Points:** - Gross tariff and certain other excise taxes brought in $7 billion in revenue to the US by January 23, 2026, significantly higher than prior years at the same point in the calendar. - The 2026 year-to-date tariff revenue ($7 billion) is well over triple the revenue collected in any prior year by the same date, showing massive early collection compared to previous years' net tariff revenue lines (which were around $2 billion by day 15). - The speaker argues that the 7% tariff revenue share of total tax revenue (reaching 7.35% by December 2026) is almost meaningless for the average person, as a $700 reduction on a $100,000 tax bill is negligible. - The primary reasons for tariffs are identified as political/behavioral—discouraging imports and favoring domestic producers (like military contractors and pharma)—rather than fiscal necessity, as the revenue does not meaningfully offset the deficit. - The cumulative federal deficit for 2026 (as of December) reached $602 billion, which is in line with or slightly better than deficits in prior years like 2025 ($711 billion) and 2022 ($378 billion) at the same point in their fiscal years. - The speaker concludes that tariffs do not reduce government spending or borrowing, nor do they meaningfully reduce individual tax burdens; instead, they artificially enrich specific politically favored sectors. ![Screenshot at 00:22: The line graph displays US gross tariff and excise tax revenue accumulation through the first 15 business days of the calendar year for 2022 through 2026, clearly showing the 2026 \(black line\) revenue soaring to $6.9 billion, vastly exceeding the ~$2 billion collected by other years at the same point.](https://ss.rapidrecap.app/screens/zrAsxblDWvc/00-00-22.jpg) **Context:** The video analyzes the early revenue generated by US tariffs and excise taxes in the first few weeks of Fiscal Year 2026, comparing this trend to the revenue collected in previous years (2021 through 2025). The speaker uses Treasury Department data to show the massive year-over-year increase in tariff collection early in the year, but critically evaluates whether this revenue stream has a substantive impact on the federal deficit or on the economic behavior of the general population, contrasting the tariff revenue with the much larger federal spending and borrowing. ## Detailed Analysis The speaker immediately highlights that by January 23rd of 2026, the US has brought in $7 billion in revenue from gross tariffs and certain other excise taxes, a figure that grows rapidly throughout the first 15 business days, reaching $6.9 billion at that mark. This performance dramatically outpaces the net tariff revenue collected in prior years (2022-2025) at the same point in the calendar, where those years hovered around $2 billion or less by day 15. However, the speaker dismisses the fiscal importance of this revenue stream. He points out that this tariff revenue, even at 7.35% of total tax revenue by December 2026, is too small to affect the massive federal deficit, which stood at $602 billion by December 2026—a figure comparable to, or slightly better than, deficits recorded in previous years. He argues that tariffs are a political tool, citing that the government artificially enriches sectors like military contractors and pharma by choosing to tax imports heavily, thereby distorting market behavior and making domestic goods artificially cheaper. For the average person paying $100,000 in taxes, the potential $700 reduction due to tariffs is meaningless. The speaker concludes that tariffs do not reduce government spending or borrowing, and the resulting tax revenue does not translate into a meaningful reduction in the tax burden for the average citizen. ### Early 2026 Tariff Revenue - US brought in $7 billion by Jan 23rd across 15 business days - 2026 revenue ($6.9B by day 15) massively exceeds prior years (e.g., 2022 revenue at day 15 was $2.2B). ### Tariffs as Share of Revenue (FY2022-2026) - Tariff share of total fiscal year revenue peaks in November, reaching 8.39% in Nov 2026, then drops to 7.35% in December, while other tax revenue shares remain stable between 1.5% and 3.5%. ### Deficit Comparison (FY2021-2026) - The cumulative federal deficit for 2026 reached $602 billion by December, comparable to the 2025 deficit ($711B) at the same point, but significantly lower than the 2021 deficit ($2,772B) by August. ### The True Purpose of Tariffs - Tariffs are not used to reduce spending or borrowing; they are political tools that incentivize domestic producers (military contractors, pharma) by punishing imports, resulting in cronyism and corruption, not greater wealth or equality for the general population. ![Screenshot at 00:22: The line graph displays US gross tariff and excise tax revenue accumulation through the first 15 business days of the calendar year for 2022 through 2026, clearly showing the 2026 \(black line\) revenue soaring to $6.9 billion, vastly exceeding the ~$2 billion collected by other years at the same point.](https://ss.rapidrecap.app/screens/zrAsxblDWvc/00-00-22.jpg) ![Screenshot at 01:11: A bar chart showing annual Gross Tariff and Certain Other Excise Tax Revenue from 2017 to 2025, highlighting the massive jump to $288.5 billion collected in 2025 compared to previous years, which were in the $80-$115 billion range.](https://ss.rapidrecap.app/screens/zrAsxblDWvc/00-01-11.jpg) ![Screenshot at 02:01: A line graph titled "Tariffs Rise as Share of Revenues" comparing tariff share of total fiscal year revenue from FY2022 to FY2026 across months, showing the 2026 projection \(black line\) peaking above 8% in November.](https://ss.rapidrecap.app/screens/zrAsxblDWvc/00-02-01.jpg) ![Screenshot at 05:01: The Deficit Tracker chart comparing cumulative federal deficit \(in billions\) from FY2021 to FY2026, showing the 2026 deficit at $602 billion by December, tracking closely with previous years' deficit levels.](https://ss.rapidrecap.app/screens/zrAsxblDWvc/00-05-01.jpg) ![Screenshot at 08:06: The 'Tariffs Rise as Share of Revenues' chart is displayed again, emphasizing that the 7.35% tariff revenue share in December 2026 is not enough to significantly alter the overall tax revenue picture or deficit trend.](https://ss.rapidrecap.app/screens/zrAsxblDWvc/00-08-06.jpg)