April 10, 2025
[Informative interactive charts and graphs at
https://www.wsj.com/economy/trade/us-exports-services-trump-tariff-calculations-fe481e2b?mod=itp_wsj,djemITP_h]
President Trump is wielding tariffs to try to close the massive U.S. trade deficit in goods, which he sees as a sign of economic weakness.
It is only part of the trade story.
While
the U.S. buys more goods from abroad than it sells, the opposite is
true for services, which include everything from streaming subscriptions
to financial advice. Trump left these service exports out of his tariff math, but they are being pulled into his trade wars.
On Wednesday, Trump ratcheted up the U.S. trade war with China, but put broader tariffs above 10% on most other countries on ice for 90 days. Sectoral tariffs such as the ones imposed on automobiles weren’t changed.
Still, the shock of Trump’s globe-spanning tariffs has sent countries scrambling and rocked markets as world leaders adapt to a suddenly much more adversarial trade relationship with the world’s biggest economy.
Countries can’t easily impose tariffs on services, but they can tax, fine or even ban U.S. companies. The European Union has floated going after big U.S. tech companies in response to Trump’s sweeping tariff threats. Trump also put U.S. service exports at risk by irking foreign consumers, many of whom might choose to avoid U.S. banks, asset managers and other firms. An economic slowdown that curbs demand as markets grapple with the president’s extreme trade makeover won’t help either.