One of the justifications for reciprocal tariffs is the claim that other countries are ripping us off. If anyone is getting ripped off, it’s definitely not the United States. As trade has expanded, all countries have gained, but none has benefited more than the United States.
Measured in nominal dollars, U.S. GDP per capita increased by $55,075 since 1994, a much bigger increase than in any of our major trading partners. After adjusting for inflation, U.S. GDP per capita has grown by $26,000, a 62% increase.
Real wealth statistics show a similar success story. According to the World Bank, comprehensive wealth per capita in the United States has increased by 22% since 1995. By this measure, we are much wealthier than our major trading partners.
Notably, as we were getting wealthier, the average world tariff applied to U.S. exports fell considerably. These cuts were spurred by win-win reciprocal trade agreements.
The record is clear. The United States has not been ripped off, and we are not subsidizing our trading partners. They have benefited, and at the same time, the United States has gotten wealthier. Everyone wins–and we win the most. We should be looking to continue this progress, not blow it up.