US deficit grows to $291 billion in July despite tariff revenue surge
The deficit for July was up 19%, or $47 billion, from July 2024. Receipts for the month grew 2%, or $8 billion, to $338 billion, while outlays jumped 10%, or $56 billion, to $630 billion, a record high for the month.
The month of July this year had fewer business days than last year, so the Treasury Department said that adjusting for the difference would have increased receipts by about $20 billion, resulting in a deficit of about $271 billion.
Net customs receipts in July grew to about $27.7 billion from about $7.1 billion in the year-earlier period due to higher tariff rates imposed by Trump, a Treasury official said. These collections were largely in line with the increase in June customs receipts after steady growth since April.
Trump has touted the billions of dollars flowing into U.S. coffers from his tariffs, but the duties are paid by companies importing the goods, with some costs often passed on to consumers in the form of higher prices.
Consumer price index data on Tuesday showed increases in prices for some tariff-sensitive goods like furniture, footwear and auto parts, but they were offset by lower gasoline prices in the overall index.
For the first 10 months of the fiscal year, customs duties totaled $135.7 billion, up $73 billion, or 116%, from the year-earlier period.
U.S. Treasury Secretary Scott Bessent told Fox Business Network's "Kudlow" program that the growing U.S. tariff revenue will make it difficult for the Supreme Court to rule against Trump's import taxes if a legal challenge to them makes its way to the country's top court.
Ken Matheny, director of macroeconomics Yale University's Budget Lab, said it is unclear how much further monthly tariff revenue will grow, but the applied tariff rate measured by customs duties divided by the value of goods imports is still around 10%, lower than the current average tariff rate of about 18% based on the latest announcements.
Significant numbers of firms are likely holding goods in bonded customs warehouses in the hope that negotiations will bring tariff rates down, but at some point those goods will enter the country, triggering duty payments, he said.
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Time Magazine
a few seconds ago
- Time Magazine
Trump's Summit With Putin Need Not Be an Echo of Appeasement
President Donald Trump's unprecedented summit with Vladimir Putin in Alaska has failed to deliver the breakthrough on securing a ceasefire in Ukraine that he was hoping for. But Trump proved to be more cautious than many diplomats thought, moving in consultation with European allies and Ukrainian President Volodymyr Zelensky—and the failure of the Alaska Summit need not be an unvarnished disaster nor an echo of Neville Chamberlain's 1938 appeasement at Munich. [time-brightcove not-tgx='true'] What comes next matters far more than the predictable failure to make a breakthrough, and now Trump needs to make the war more costly to Putin financially and militarily. It's time to call Putin's bluff. As Trump himself declared before the meeting, if Putin did not agree to stop his war on Ukraine, there must be 'severe consequences,' and the time has come for Trump to tighten the screwsby increasing economic pressure on Putin and by buttressing military assistance for Ukraine. As Admiral James Savridis, Former Supreme Allied Commander of NATO, complained: 'Putin strung Trump along again with diplomatic rope-a-dope and there should be military consequences for Putin.' It would be a tragic mistake if this turned into merely another instance when Trump threatens Putin with tough talk, only to back down prematurely. Clearly, Putin is counting on Trump backing down and falling victim to his smoke and mirrors. But that bark-and-no-bite approach would destroy U.S. credibility as much as it would erode Trump's own credibility. Trump's initial reaction, declaring on Fox News that it would be up to President Zelenskyy to push the ball forward, is exactly the opposite of what should be done. The truth is that even now, Trump holds all the leverage while Putin has none. Read more: Why Trump's Summit in Alaska Cannot End Putin's War in Ukraine Despite Putin's braggadocio, claiming a win from the legitimacy of visiting U.S. soil for the first-time in a decade, despite having an ICC arrest warrant to his name after the killing of tens of thousands of civilians and the kidnapping of 20,000 children; still, Trump averted the worst-case scenario of falling for Putin's propaganda, stopping hours of planned follow-up meetings that Putin had planned with Russian business and economic development officials. Trump has been correct in recognizing that none of the 1,200 companies whose exit from Russia we helped accelerate have ever expressed interest in returning to Russia. The fact that Putin even thought that the U.S. needs the Russian economy shows how deluded Putin still is. Putin's only commodities are easily interchangeable raw materials that he brings to the world market; no finished goods, industrial products, pharmaceutical ingredients, fashion or financial products come from Russia at scale. Like a mercantile colony, all Putin has is a lot of land, raw materials, and psychopathic propaganda. The reality is that despite Putin's tough guy bluster, Putin is a failure economically and militarily, and Putin's house of cards is far more vulnerable than many realize. In fact, after three years of grueling warfare, Putin's economy is in tatters as Putin stares down bankruptcy. As we revealed previously, for years now, Putin has been obfuscating how weak the Russian economy really is by hiding and fudging the numbers. Putin refuses to disclose major economic indicators as required by the International Monetary Fund (IMF). This ranges from foreign trade data, monthly output data on oil and gas, and central bank monetary base data. Due to Putin's obfuscation, few appreciate how close Russia is to running out of cash. The value of Russia's sovereign wealth fund and foreign exchange reserves has dwindled by half since Putin's invasion of Ukraine, as he draws down his windfall oil revenues faster than he can replenish his coffers. That is because Putin is running an unsustainable record budget deficit to fund his war machine in the tens of billions. And with over 1,000 multinational businesses having exited from Russia, the Kremlin is running out of new cookie jars to raid to keep the lights on. Read more: Why The Last Six Trump-Putin Meetings Failed The time has come for Trump to escalate economic sanctions and economic pressure on Russia by cutting off Putin's exports of oil and other natural resources, once and for all. By tightening the screws on Putin's already crumbling economic house of cards, Putin could run out of money very soon—perhaps even by the end of the year. Already, Trump has threatened secondary tariffs on India for buying Russian oil, which aligns with the bipartisan legislation put forward by many of his GOP allies in the Senate, including the 'Sanctioning Russia Act of 2025' legislation co-sponsored by Senator Lindsey Graham and Senator Richard Blumenthal, which would impose secondary tariffs and sanctions on countries which continue to fund Russia's war machine. Simultaneously, Trump has to fortify military assistance for Ukraine, with our European allies being forced to shoulder an increasing share of the burden as previously-appropriated U.S. support dwindles. Already, there is growing momentum in Congress, including from Trump's GOP allies, for another major military aid package to help Ukraine, despite the misguided cries of outnumbered, outgunned isolationists such as JD Vance not to support Ukraine anymore. Already, there is a bipartisan proposal in the Senate for a new $54.6 billion package in new aid to Ukraine, which would make it the largest aid package for Ukraine yet. Providing Ukraine with desperately needed military aid is the best way to show Putin who really holds the leverage. In particular, replenishing Ukraine's stock of F-16s and Patriot missile interceptors would be an incredibly powerful and effective boost. That military aid is sorely needed. As Ambassador Michael McFaul pointed out on MSNBC, 'since President Trump has been in the White House, the war has gotten more aggressive. There's been more attacks on Ukrainian civilians, the number of drone and missile attacks have gone up'. After trying and failing to secure a ceasefire from Putin, the time has come for Trump to impose the 'severe consequences' against Putin that he has previously threatened. If he fails to do so, then Trump's inaction, after Putin's blatant unwillingness to agree to a ceasefire and other measures to end the war on constructive terms, will be deserving of the comparisons to Chamberlain's Munich summit with Hitler—and go down as a far greater blunder than Joe Biden's disastrous withdrawal from Afghanistan.'
Associated Press
a few seconds ago
- Associated Press
Putin emerges from the Alaska summit with increased stature and Trump echoing a Kremlin position
In Alaska, President Vladimir Putin walked on a red carpet, shook hands and exchanged smiles with his American counterpart. Donald Trump ended the summit praising their relationship and calling Russia 'a big power ... No. 2 in the world,' albeit admitting they didn't reach a deal on ending the war in Ukraine. By Saturday morning Moscow time, Trump appeared to have abandoned the idea of a ceasefire as a step toward peace -– something he and Ukraine had pushed for months -– in favor of pursuing a full-fledged 'Peace Agreement' to end the war, echoing a long-held Kremlin position. The 'severe consequences' he threatened against Moscow for continuing hostilities were nowhere in sight. On Ukraine's battlefields, Russian troops slowly grinded on, with time on their side. The hastily arranged Alaska summit 'produced nothing for Mr. Trump and gave Mr. Putin most of what he was looking for,' said Laurie Bristow, a former British ambassador to Russia. The summit spectacle Putin's visit to Alaska was his first to the United States in 10 years and his first to a Western country since invading Ukraine in 2022 and plunging U.S.-Russia relations to the lowest point since the Cold War. Crippling sanctions followed, along with efforts to shun Russia on the global stage. In another major blow, the International Criminal Court in 2023 issued an arrest warrant against Putin on accusations of war crimes, casting a shadow on his foreign trips and contacts with other world leaders. Trump's return to the White House appeared to upend all that. He warmly greeted Putin, even clapping for him, on a red carpet as U.S. warplanes flew overhead as the world watched. The overflight was both 'a show of power' and a gesture of welcome from the U.S. president to the Kremlin leader, 'shown off to a friend,' said retired Col. Peer de Jong, a former aide to two French presidents and author of 'Putin, Lord of War.' Russian officials and media reveled in the images of the 'pomp-filled reception' and 'utmost respect' that Putin received in Alaska. Putin has 'broken out of international isolation,' returning to the world stage as one of two global leaders and 'wasn't in the least challenged' by Trump, who ignored the arrest warrant for Putin from the ICC, Bristow told The Associated Press. For Putin, 'mission accomplished' Putin 'came to the Alaska summit with the principal goal of stalling any pressure on Russia to end the war,' said Neil Melvin, director of international security at the London-based Royal United Services Institute. 'He will consider the summit outcome as mission accomplished.' In recent months, Trump has pressed for a ceasefire, something Ukraine and its allies supported and insisted was a prerequisite for any peace talks. The Kremlin has pushed back, however, arguing it's not interested in a temporary truce -– only in a long-term peace agreement. Moscow's official demands for peace so far have remained nonstarter for Kyiv: It wants Ukraine to cede four regions that Russia only partially occupies, along with the Crimean Peninsula, illegally annexed in 2014. Ukraine also must renounce its bid to join NATO and shrink its military, the Kremlin says. After Alaska, Trump appeared to echo the Kremlin's position on a ceasefire, posting on social media that after he spoke to Ukraine's President Volodymyr Zelenskyy and European leaders, 'it was determined by all that the best way to end the horrific war between Russia and Ukraine is to go directly to a Peace Agreement, which would end the war, and not a mere Ceasefire Agreement, which often times do not hold up.' In a statement after the Trump call, the European leaders did not address whether a peace deal was preferable to a ceasefire. The pro-Kremlin tabloid Komsomolskaya Pravda described it as a 'huge diplomatic victory' for Putin, whose forces will have time to make more territorial gains. The summit took place a week after a deadline Trump gave the Kremlin to stop the war or face additional sanctions on its exports of oil in the form of secondary tariffs on countries buying it. Trump already imposed those tariffs on India, and if applied to others, Russian revenues 'would probably be impacted very badly and very quickly,' said Chris Weafer, CEO of Macro-Advisory Ltd. consultancy. In the days before Alaska, Trump also threatened unspecified 'very severe consequences' if Putin does not agree to stop the war. But whether those consequences will materialize remains unclear. Asked about it in a post-summit interview with Fox News Channel, Trump said he doesn't need 'to think about that right now,' and suggested he might revisit the idea in 'two weeks or three weeks or something.' Alexandra Prokopenko of the Carnegie Russia Eurasia Center and a former adviser at the Russian Central Bank, posted on X that it was 'an important tactical victory for Putin' that gives Moscow 'an opportunity to build alternatives and be prepared.' More pressure on Ukraine In a statement after the summit, Putin claimed the two leaders had hammered out an 'understanding' on Ukraine and warned Europe not to 'torpedo the nascent progress.' But Trump said 'there's no deal until there's a deal.' In his Fox interview, Trump insisted the onus going forward might be on Zelenskyy 'to get it done,' but said there would also be some involvement from European nations. Zelenskyy will meet Trump at the White House on Monday. Both raised the possibility of a trilateral summit with Putin, but Kremlin aide Yuri Ushakov said it wasn't discussed in Alaska. The Kremlin has long maintained that Putin would only meet Zelenskyy in the final stages of peace talks. 'Trump now appears to be shifting responsibility towards Kyiv and Europe, while still keeping a role for himself,' Tatiana Stanovaya of the Carnegie Russia and Eurasia Center wrote on X. Fiona Hill, a senior adviser on Russia in his first administration, told AP that Trump has met his match because 'Putin is a much bigger bully.' Trump wants to be the negotiator of 'a big real estate deal between Russia and Ukraine,' she said, but in his mind he can 'apply real pressure' only to one said — Kyiv. Hill said she expects Trump to tell Zelenskyy that 'you're really going to have to make a deal' with Putin because Trump wants the conflict off his plate and is not prepared to put pressure on the Russian president. Far from the summit venue and its backdrop saying 'Pursuing Peace,' Russia continued to bombard Ukraine and make incremental advances on the over 600-mile (1,000-kilometer) front. Russia fired a ballistic missile and 85 drones overnight. Ukraine shot down or intercepted 61 drones, its air force said. Front-line areas of Sumy, Dnipropetrovsk, Donetsk and Chernihiv were attacked. Russia's Defense Ministry said it had taken control of the village of Kolodyazi in the Donetsk region, along with Vorone in the Dnipropetrovsk region. Ukraine did not comment on the claims. Russian forces are closing in on the strongholds of Pokrovsk and Kostiantynivka in the Donetsk region, which Moscow illegally annexed in 2022 but still only partially controls. 'Unless Mr. Putin is absolutely convinced that he cannot win militarily, the fighting is not going to stop,' said Bristow, the former ambassador. 'That's the big takeaway from the Anchorage summit.' —— Associated Press writers John Leicester in Paris and Elise Morton and Pan Pylas in London contributed.
Politico
a few seconds ago
- Politico
State Department halts visitor visa process for all Gazans
The far-right podcast host and presidential ally on Friday made several posts about alleged flights of Gazans to the U.S. with humanitarian aid group HEAL Palestine, which seeks to evacuate and provide medical assistance for injured Gazans — in particular children — wounded during Israel's ongoing offensive in the besieged strip. According to the organization's website, it has successfully evacuated 148 total Gazans, including 63 injured children, bringing them to the U.S. for medical care. Loomer raged against the program in a series of posts Friday and Saturday morning, demanding that 'the Trump administration needs to shut this abomination down ASAP before a family member of one of these GAZANS goes rogue and kills Americans for HAMAS.' Her posts caught the attention of some staunch pro-Israel Republicans. 'Deeply concerned about the incoming flights - including to Texas - allegedly filled with folks from Gaza as reported by @LauraLoomer. Inquiring,' Rep. Chip Roy (R-Texas) wrote on Friday. After the State Department made its announcement, Rep. Randy Fine (R-Fla.) attributed the decision to Loomer's agitating, writing on X that 'massive credit needs to be given to @LauraLoomer for uncovering this and making me and other officials aware.' The administration's move comes amid an international reckoning over Israel's war in Gaza. An increasing number of the U.S.'s global allies — as well as members of President Donald Trump's MAGA circles — have expressed outrage over the dire conditions in the strip, and demanded that the U.S. reconsider its support for the country's government. But while Trump has made comments recognizing the humanitarian crisis in Gaza, his administration has shown no sign of wavering in its support of Israeli Prime Minister Benjamin Netanyahu. As a growing list of countries have come out in support of Palestinian statehood, the State Department last month sanctioned leaders of the Palestine Liberation Organization and Palestinian Authority, while top U.S. officials publicly embraced Israeli leadership.
