Liberation Day Turns One. The Numbers Didn't Show Up.

The trade deficit — the signature metric the administration promised to shrink — hit an all-time record high during the tariff regime [2]. This is not a rounding error or a lagging indicator. It is a repudiation of the core economic logic behind the policy. Tariffs were supposed to make imports more expensive, reduce import demand, and narrow the gap. Instead, American businesses and consumers absorbed the cost increases while continuing to import. The deficit widened. The numbers are what they are.

• Manufacturing jobs as share of workforce: lowest since 1939
• U.S. trade deficit: all-time record high
• Agricultural trade deficit: up 10.8% to $41 billion
• Net government revenue after Supreme Court refund: negative
• Retaliatory tariffs from trading partners: substantial and ongoing

The Conservative Reckoning

The National Taxpayers Union — an organization that has reliably supported Republican economic policy for decades — published a thorough review of Liberation Day's first year that deserves more attention than it has received [1]. Their analysis is not ideologically motivated against the president. It is motivated by the same concern that drives responsible conservatism: does the policy work? In the case of these tariffs, the NTU's answer is a careful, documented no. They are not alone. The Council on Foreign Relations has reached similar conclusions from a national security lens, noting that the tariff regime has strained alliances that America needs for genuine strategic competition with China [4].

The tariffs have handcuffed American farmers and manufacturers rather than liberating them.

— National Taxpayers Union, Liberation Day One-Year Review, 2026

Agriculture tells a particularly uncomfortable story. The farm lobby is among the most reliably Republican constituencies in the country, and Liberation Day has been especially unkind to it. The agricultural trade deficit rose 10.8% to $41 billion [1]. Soybean exports to China — one of the explicit recovery targets after the first trade war — have not returned to pre-tariff levels. Retaliatory measures from the EU, Canada, and Mexico hit American grain, meat, and dairy exports hard. The farmers who voted for this policy and its architect are absorbing costs that were supposed to fall on trading partners. They did not.

The $166 Billion Court Bill

The Supreme Court's ruling striking down the IEEPA tariffs as unconstitutional added a significant fiscal dimension to the policy's failure [3]. The Court ordered refunds totaling approximately $166 billion — money that had been collected from American importers, passed along to consumers in higher prices, and now had to be returned. When you net that against total tariff revenue, the federal government recorded a loss on the program. We imposed enormous economic disruption across the American economy and ended up with less money than we started with. It would be almost darkly comic if the costs weren't real.

What Good Trade Policy Actually Looks Like

Conservatives are not wrong to want leverage against China. The concern about strategic dependency — semiconductors, rare earth minerals, pharmaceuticals — is legitimate and urgent. The question was never whether to use trade policy as a tool. The question was whether carpet-bombing 180 countries with tariffs, including our closest allies, was a sensible application of that tool. It was not. Targeted, strategic tariffs on genuinely sensitive supply chains have a defensible economic logic. Blanket tariffs on everything from Canadian lumber to Vietnamese sneakers do not. Reagan understood the difference. The distinction matters [4].

The intra-conservative debate over Liberation Day is worth having honestly. Groups like the NTU, the American Enterprise Institute, and mainstream economic conservatives have been making this argument for a year, mostly to polite dismissal. A year of data has a way of moving conversations. The manufacturing jobs aren't coming back faster than they're leaving. The deficits aren't shrinking. The allies we need for a coherent China strategy are irritated. The farmers who need export markets are facing a 10.8% larger hole in their trade balance. These are not leftwing talking points. They are quarterly reports [2].

I supported the goal. I have written at length about the strategic case for reducing dependency on adversarial supply chains. But the goal and the execution are different things, and confusing the two is precisely how policies fail twice — once in practice, and again in the autopsy, when defenders insist the numbers just need more time. They have had a year. The scoreboard is what it is.