A top economist was shocked to learn the Trump administration used his research to justify its hefty tariffs — insisting the White House got his formula “very wrong” and grossly miscalculated the levies for each country.
Brent Neiman, a University of Chicago economics professor, said in a New York Times op-ed that President Trump’s sweeping tariff regime should have been roughly four times less if his study had been followed correctly.
The economic expert, who co-wrote the research with three other renowned economists, noted that his first question when Trump unveiled its tariff rates was: “How on earth did it calculate such huge rates?”
“The next day it got personal. The Office of the U.S. Trade Representative released its methodology and cited an academic paper produced by four economists, including me, seemingly in support of its numbers,” he wrote.
“But it got it wrong. Very wrong,” he said.
“I disagree fundamentally with the government’s trade policy and approach. But even taking it at face value, our findings suggest the calculated tariffs should be dramatically smaller — perhaps one-fourth as large.”
Neiman, who served as a treasury official during the Biden administration, suggested Trump’s team incorrectly plugged a 25% rate into its formula to come up with the levies.
“Where does 25% come from? Is it related to our work? I don’t know,” he wrote.
“Had the trade office instead used a value closer to the 95 percent number from our work, as I believe it should have done, the computed tariffs would have been as little as one-fourth of what they are.”
The professor said the “biggest mistake” was leveraging the reciprocal tariffs to try to eliminate trade deficits with some of the Unites States’ major trading partners.
“The office said it calculated its reciprocal tariffs at a level that would theoretically eliminate trade deficits with ‘each of our trading partners,’ one by one. Is that a reasonable goal?” he wrote.
“It is not. Trade imbalances between two countries can emerge for many reasons that have nothing to do with protectionism. Americans spend more on clothing made in Sri Lanka than Sri Lankans spend on American pharmaceuticals and gas turbines. So what? That pattern reflects differences in natural resources, comparative advantage and development levels.”
“The deficit numbers don’t suggest, let alone prove, unfair competition,” he added.
Neiman’s reaction comes after Trump announced a 10% baseline tariff on all imports to the US last week, as well as higher duties on some of the country’s biggest trading partners — ranging from premium Italian coffee and Japanese whisky to sportswear made in Asia.
Trump has justified the hefty levies by arguing the “reciprocal” tariffs were a response to duties and other non-tariff barriers put on US goods.
He has insisted, too, that the tariffs would boost manufacturing jobs at home.
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