Trump’s tariff revenue could help keep the government open. Why isn’t that happening?
By Elisabeth Buchwald, CNN
(CNN) — Hundreds of thousands of federal government employees are being furloughed or working without pay during the ongoing government shutdown. Core functions, including many food and drug inspections, are suspended because Republicans and Democrats remain deadlocked on funding the government.
Meanwhile, the government continues to rake in record levels of tariff revenue, which President Donald Trump frequently brags about.
Those tens of billions of dollars are a drop in the bucket compared to what it takes to fund the government, but they could soften the blow from the shutdown – at least temporarily – while lawmakers remain at odds.
Last month, the Treasury Department reported tariff revenue of $31.7 billion, bringing total tariff collections so far this year to $190 billion, a 160% increase compared to the same period last year.
On October 1, the first day of the shutdown, the government collected $315 million from tariffs, according to the Treasury Department’s daily statement. By comparison, the total daily compensation of approximately 750,000 federal workers furloughed during the shutdown is roughly $400 million, according to Congressional Budget Office estimates.
The tariff money goes into a general fund managed by the Treasury Department. The Treasury refers to that account as “America’s checkbook,” because it’s used to pay some of the government’s pre-existing bills, such as distributing tax refunds.
But the Treasury’s general fund and all the tariff revenue flowing into it is essentially frozen until a bill is passed to fund the government. Congress and Trump could get around that by passing a measure designating the tariff revenue for a specific use, like paying employees who are furloughed. However, neither party appears keen on that.
“We don’t need any novel solutions to reduce the blow of the Democrats’ government shutdown — all that needs to happen is the Democrats reopening the government by passing a clean continuing resolution as they’ve done many times before,” White House spokesperson Kush Desai said in a statement to CNN.
Many Democrats, meanwhile, are grappling with the tariffs as a new source of government revenue. They believe the funds are coming at the expense of many Americans who will be or are already paying higher prices for goods because of the tariffs.
“Congress should repeal Trump’s trade taxes and give Americans some relief, not lock in high tariffs and higher prices,” Sen. Ron Wyden of Oregon, the top Democrat on the Senate Finance Committee, told CNN in a statement.
He added: “On top of that, even Trump’s bloated tariff scheme brings in only a small fraction of the revenue needed to fund the military, national parks, highways, federal law enforcement, and other essential government services.”
“Trump’s tariffs are the problem, not the solution,” Wyden said.
The-CNN-Wire
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