The Left has tried to fear monger. But their lies are falling on deaf ears.
Because Donald Trump’s tariffs had a cataclysmic consequence that changes everything.
Early Fiscal 2026 Deficit Trends Show Revenue Surge
Two months into fiscal year 2026, which began October 1, the U.S. federal deficit has narrowed compared to the prior year, driven primarily by an 18% jump in revenue that outpaces relatively flat spending. Overall, the government has collected $740 billion in receipts while outlays total nearly $1.2 trillion, yielding a $458 billion deficit so far—lower than the pace of fiscal 2025’s record $1.8 trillion annual shortfall.
Analysts attribute much of the revenue boost to heightened customs duties from President Trump’s tariffs, implemented starting in February 2025 and bolstered by the July reconciliation act.
Tariff collections are running $50 billion ahead of last year, contributing to a total income increase of $112 billion over the same period in 2024—or $115 billion when adjusted for calendar shifts like weekend payment timing. The Congressional Budget Office confirmed: “That increase was caused largely by changes in tariff rates that began in February 2025 and reflects the enactment in July of the 2025 reconciliation act.”
Payroll and individual income taxes also played a role, with payments rising despite lower withholdings, though tariffs dominate the gains.
Lingering Shutdown Effects and Sector-Specific Spending Shifts
The numbers still reflect disruptions from the record-long government shutdown, which spanned October 1 to November 12 and delayed various payments.
Treasury officials noted, for instance, that the Agriculture Department lags $11 billion behind projected spending due to postponed disbursements.
Elsewhere, mandatory programs show upward pressure: Medicare outlays are up 14%, driven by higher per-enrollee costs, while Medicaid spending has increased 6%. Social Security expenditures rose 7%, attributable to growing beneficiary rolls, cost-of-living adjustments, and a 2023 law enabling some public employees to receive benefits alongside pensions.
On the flip side, Department of Homeland Security spending dipped below last year’s levels, thanks to a milder hurricane season. Net interest payments on the debt, now totaling $179 billion over the past two months, continue to climb in tandem with the $38.4 trillion total federal debt ($30.8 trillion held by the public).
Tariff Boosts, Economic Trade-Offs, and Long-Term Fiscal Warnings
President Trump has highlighted the tariff windfall, joking that budget officials were puzzled by the revenue spike until checking the customs column. He has also proposed a $12 billion aid package for farmers hit by retaliatory tariffs from trading partners, acknowledging sector-specific strains.
Democrats, however, argue the policies overlook broader consumer impacts. Senate Minority Leader Charles E. Schumer (D-N.Y.) criticized: “What kind of world does he live in? Does he understand that these tariffs are raising prices through the roof?” He described Trump’s optimism as an economic “delusion.”
Trump maintains the measures will revitalize U.S. manufacturing and create jobs, but data so far indicates otherwise: The Peterson Institute for International Economics reports that manufacturing employment growth “has been particularly weak in 2025.”
Experts caution that while tariffs provide a short-term fiscal lift—potentially reducing deficits by $2.5–3.3 trillion over the next decade per CBO estimates—they fall short of addressing the structural gap. Annual deficits are projected to exceed $1 trillion near-term and climb toward $2 trillion, with total federal debt on track to hit 120% of GDP by 2035 under current policies.
Maya MacGuineas, president of the Committee for a Responsible Federal Budget, warned: “This is simply unsustainable.” She highlighted soaring debt interest costs and looming insolvency for Medicare and Social Security within seven years, which could trigger automatic benefit cuts. “Policymakers should work together on an attainable fiscal goal that will put us on a path to long-term economic stability,” she urged.
