Tariffs — State of the Union Address, Trump again pushes the notion that the US used to have no federal income tax because tariff revenue was all that the government needed to sustain themselves. The federal budget in 1901 was $525 million or 3% of GDP and total debt was roughly $2 billion. Averaging in inflation, the budget would equate to $20 billion and the debt to $76 billion today. Trump’s budget is $6 trillion+. We are operating at 128% of GDP on debt of nearly $40 trillion. Using the 1900’s to justify tariffs today is a ridiculous comparison that has no basis in reality.
The overextended growth of the US government began in 1979 with Jimmy Carter’s malaise. Since then, the federal government’s spending skyrocketed into deficit stratospheres with a brief pause between 1997 and 2000. In 1913 Woodrow Wilson introduced the income tax to pay for WWI. The United States has since become a war economy.
In 2025, the US imported $3.44 trillion in goods – further defining America’s inability to be self sufficient in anything. A 10% tariff across the board would levy $344 billion in receipts, whereas our current allocation to the Feds for income tax is roughly $2.5 trillion. Simple math. In order for Trump to aggregate the value of the income tax, tariffs would have to be levied at 90%. This would equate to a 100% inflation cost of all imported goods. Running the risk that countries would reciprocate, the global economy would literally CRASH. A $50,000 automobile would be $100,000. Every technology apparatus would double from phones to computers, to kitchen appliances, to electricity, and beyond.
We don’t have mathematicians or economists running the White House – we have lawyers, bankers and conmen. It is no different than having a lawyer conduct surgery – their acumen is based on argue everything even when you are wrong. They would undoubtedly remove your liver for a head-cold. Trump is following those orders. TARIFFS can never replace the income tax unless we can reduce the government and its budget by 90%.
Social Security
Every single year we are told that Social Security is broke and retirees will have to take a cut in their receipts. The fact that Social Security utilizes a completely different schematic to calculate inflation than government employees is only matched by the fact that government pensions are never similarly targeted for bankruptcy. How is that possible?
US Treasury
As of 2024, the last time the government pulled a calculation out of thin air, the total pension liability at the time amounted to $3.34 trillion – a 5.5% increase over 2023 due to inflation. Where is that money supposed to come from? According to the US Treasury 2024 Balance Sheet, total assets are $5.6 trillion on liabilities of $45.5 trillion. Within the receivable section of the Balance Sheet, $2.15 trillion is for loans, including education that will never be repaid. In addition, $1.3 trillion in Property Plant and Equipment that could generate likely 35cents on the dollar. So the $5 trillion in assets is more likely $2 trillion. It isn’t Social Security that is in trouble – it is the entire government system. And tariffs will exasperate the value of living for all 345 million taxpayers to the point of third-world status.
To mitigate the mess, Trump is proposing a Thrift Plan of Savings for Americans. All you have to do is turn over your retirement to the US government. The fund is managed by the Federal Retirement Thrift Investment Board. It is currently managed by Democrat Lawyer and politician Mike Gerber. The five-member part-time Board is required by FERSA to have “substantial experience, training, and expertise in the management of financial investments and pension benefit plans.”
Other Board members include Dana Bilyeu, a lawyer, Leona Bridges, MBA from Barclays, aka BlackRock, and Stacie Olivares, MPP Business and Government. The fifth member is ‘vacancy’.
What Trump is entertaining is for millions of hard working civilians to give their money to FERSA which will be ‘accounted for’ as a Trust but will be used as a slush fund for more government warfare funding. No one would be able to touch their money until the new retirement age of death per Ben Shapiro and Ted Cruz. Given Social Security is ‘bankrupt’ – FINRA would call this investment FRAUD.
Yet the Trump gala touts how strong the economy really is despite bankruptcies rising 14%, and unfettered debt. Not only is it negligent, fraudulent, and unsustainable, the ONLY way out is for government to step down, forfeit their pensions, pay back the graft, and sacrifice their individual wealth gained on the backs of taxpayer labor.
While tariffs funded 19th-century government, they were volatile, regressively taxed consumption, and raised prices. Income taxes allow for higher, more reliable revenue as the government is ‘ever expanding’. Current federal employees – roughly 9.1 million – 3 million of which are actual employees, the remaining include contract and grant employees doing the actual work on behalf of the government because lawyers don’t know how to contribute to society.
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Helena Glass is Former CPA & Series 7, with emphasis in Real Estate and Financial Planning. Two brains in one: former Bronze Sculpter and Danseuse. Visit the author’s blog.
She is a regular contributor to Global Research.
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