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Manhattan Institute Issues Commentary to Discourse Magazine: FinReg Backtrack Brings Good News for Small Business
NEW YORK, April 22 -- The Manhattan Institute issued the following excerpts of a commentary on April 21, 2025, to Discourse Magazine:
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A FinReg Backtrack Brings Good News for Small Business
By C. Jarrett Dieterle
A new deregulatory push in the financial regulation arena will help small businesses and family farms
Since its inception, the second Trump administration has been signaling an intention to usher in a pro-growth deregulatory agenda. As the administration finds its sea legs, much of this action has played out via high-profile changes in federal agency leadership and the rescinding
... Show Full Article
NEW YORK, April 22 -- The Manhattan Institute issued the following excerpts of a commentary on April 21, 2025, to Discourse Magazine:
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A FinReg Backtrack Brings Good News for Small Business
By C. Jarrett Dieterle
A new deregulatory push in the financial regulation arena will help small businesses and family farms
Since its inception, the second Trump administration has been signaling an intention to usher in a pro-growth deregulatory agenda. As the administration finds its sea legs, much of this action has played out via high-profile changes in federal agency leadership and the rescindingof Biden-era rules. But a recent decision by the Treasury Department to substantially reform Beneficial Ownership Interest requirements under the Corporate Transparency Act provides a foretaste of the type of proactive regulatory changes that may be afoot--particularly in the area of finance. The winners will be American small businesses and family farms by reducing needless paperwork that many of these entities were not even aware was required under the law.
Continue reading the entire piece here at Discourse Magazine (https://www.discoursemagazine.com/p/a-finreg-backtrack-brings-good-news)
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C. Jarrett Dieterle is a nonresident senior fellow at the R Street Institute and a legal policy fellow for the Manhattan Institute.
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Original text here: https://manhattan.institute/article/a-finreg-backtrack-brings-good-news-for-small-business
[Category: ThinkTank]
Jamestown Foundation Issues Commentary to Eurasia Daily Monitor: Armenian Local Elections a Barometer for Pashinyan's Political Future
WASHINGTON, April 22 -- The Jamestown Foundation posted the following commentary on April 21, 2025, to the Eurasia Daily Monitor:
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Armenian Local Elections a Barometer for Pashinyan's Political Future
By Onnik James Krikorian
Executive Summary:
* Recent local elections in the Armenian municipalities of Gyumri and Parakar revealed growing political challenges for Prime Minister Nikol Pashinyan ahead of the 2026 parliamentary elections. Civil Contract, the ruling party, failed to secure a majority in Gyumri and lost outright in Parakar.
* These results highlight Pashinyan's declining popularity
... Show Full Article
WASHINGTON, April 22 -- The Jamestown Foundation posted the following commentary on April 21, 2025, to the Eurasia Daily Monitor:
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Armenian Local Elections a Barometer for Pashinyan's Political Future
By Onnik James Krikorian
Executive Summary:
* Recent local elections in the Armenian municipalities of Gyumri and Parakar revealed growing political challenges for Prime Minister Nikol Pashinyan ahead of the 2026 parliamentary elections. Civil Contract, the ruling party, failed to secure a majority in Gyumri and lost outright in Parakar.
* These results highlight Pashinyan's declining popularityand a reinvigorated, if still divided, opposition. The outcomes complicate Pashinyan's broader agenda, including moving closer to the European Union and normalizing relations with Azerbaijan and Turkiye.
* Pashinyan faces mounting pressure to restore political momentum and redefine his leadership amid a shifting domestic and international landscape, including moves to re-engage with Russia.
Prime Minister Nikol Pashinyan finds himself facing a turbulent political landscape following snap local elections in the municipalities of Gyumri and Parakar late last month (see EDM, November 27, 2024). Despite municipal votes often being dismissed as minor, the outcome of the March 30 elections carries national weight (Azatutyun, March 31). In both Gyumri and Parakar, Pashinyan's ruling political party, Civil Contract, failed to secure a majority of the votes. The elections were widely considered a referendum on Pashinyan's premiership. Pashinyan's approval ratings hover around 11 percent, according to a survey published in January of this year (News.am, January 31; Groong, February 2). This, combined with the election results in Gyumri and Parakar, means that Pashinyan's political survivability may be in question.
In Gyumri, Armenia's second-largest city and home to the Russian 102nd military base, Pashinyan's approval ratings are particularly symbolic given that he embarked on a pivotal march to unseat his predecessor, walking 117 kilometers (72 miles) from Gyumri to Yerevan in 2018, almost seven years ago to the day (ArmInfo, March 31, 2018). Despite most Armenians expecting Pashinyan's Civil Contract party to outright win the elections, there was the possibility that another party could strike a deal for it to still govern.
In September 2023, Civil Contract had also failed to win an outright majority in the Yerevan municipal elections, attracting just 33 percent of the vote. Pashinyan's candidate, Tigran Avinyan, had to instead rely on an extra-parliamentary Public Voice led by a former policeman and controversial video blogger, currently detained in the United States, to retain power (Azatutyun, September 18, 19, 2023, February 28). In Gyumri last month, however, there was no political force to make a deal. Even a new pro-European Union extra-parliamentary force believed close to Pashinyan failed to pass the six percent threshold (Armenian Central Electoral Commission, March 31).
Civil Contract's Sarik Minasyan led Gyumri with 36.21 percent of the vote (EVN Report, April 16). His main challenger, controversial former mayor Vardan Ghukasyan (not to be confused with the candidate of the same name in Yerevan's 2023 municipal vote), now representing the Communist Party, followed with 20.5 percent. Martun Grigoryan from the opposition Our City Alliance came in third at 15.5 percent, Ruben Mkhitaryan of My Strong Community with 7.9 percent came in fourth, and Karen Simonyan of Mother Armenia with 6.11 percent came in fifth, respectively. This meant that Pashinyan's party would only obtain 14 seats, unable to form a majority (Armenian Central Electoral Commission; Azatutyun, March 31).
Ghukasyan's election as mayor is particularly surprising given his track record under the unpopular administrations that preceded Pashinyan. Despite accusations of corruption, violence, and the death of a child allegedly during a shootout involving Ghukasyan's son during and after his 1999-2012 tenure, Ghukasyan was supported by the other parties (Azatutyun, July 12, 2007; A1 Plus, April 24, 2013; ARKA, December 18, 2023). This even included Grigoryan, despite a personal history with Ghukasyan, whose nephew was sentenced to 17 years imprisonment in 2014 for the murder of one of his associates (Epress, July 22, 2014).
The outcome leaves Gyumri under opposition control at a time when Pashinyan is looking westward. A bill to eventually seek EU membership was recently passed by Armenia's National Assembly, championed by the European Alliance. This extra-parliamentary bloc, however, failed to gain sufficient votes in the Gyumri election. This all unfolds against a backdrop of larger geopolitical shifts with Pashinyan especially eager to normalize relations with Turkiye, including eventually reviving the Gyumri-Kars railway (see EDM, May 6, 2024).
It remains unclear whether a pro-Russian, anti-Turkish figure such as Ghukasyan complicates matters (X/@hayqmets, April 3). Since becoming mayor, he has already called for a Union State with Russia similar to the model in place for Belarus (Caucasus Watch, April 17). Normalizing relations with Turkiye is considered key for Armenia to effectively diversify away from Moscow (see EDM, January 28). Meanwhile, a criminal investigation was launched on April 1 against Ghukasyan for allegedly attempting to coerce voters. He had been briefly detained before the vote for suspected illegal arms possession (Azatutyun, February 20). The new city council officially elected Ghukasyan while Pashinyan's Civil Contract boycotted the vote.
In Parakar, a village near Yerevan, the opposition-aligned Country of Living party--reportedly linked to Russian-Armenian businessman Ruben Vardanyan, now on trial in Baku--won decisively with over 56 percent (Armenian Central Electoral Commission, March 31). Civil Contract lost outright, prompting one political activist and analyst, whose own party failed to win seats in Gyumri, to declare both results as the beginning of the end for Pashinyan's rule (Facebook/surenyants, March 31). Such forecasts, however, may be premature.
Government supporters point out that Civil Contract lost Gyumri in local elections even after winning the 2021 parliamentary vote. Voter turnout in Gyumri, moreover, was up significantly--from 24 percent in 2021 to 42.68 percent this year (Armenian Central Electoral Commission, October 17, 2021, March 31). In a written statement, Pashinyan took a more optimistic tone, congratulating all candidates and considering it an example of a democratic vote (ArmenPress, March 31).
The political implications of these results are hard to ignore. As Pashinyan eyes a constitutional referendum--a prerequisite for signing a peace agreement with Azerbaijan--he needs not only to win in 2026 but to do so with an absolute majority in parliament (see EDM, March 24). He needs to accomplish this to ensure an attempt to normalize relations with Azerbaijan and Turkiye. With the opposition energized, the road ahead remains uncertain.
Pashinyan could consider changing the parliamentary system in any referendum. This has been hinted at before (see EDM, January 31, 2024). Speaking about the Gyumri vote, however, Yerevan mayor Avinyan dismissed such speculation (News.am, April 11). The broader regional context complicates matters. A peace deal with Azerbaijan remains linked to constitutional changes, while the potential re-engagement of Russia in the region further muddles the water (see EDM, June 25, 2024).
Re-engagement with Russia is would explain why, on March 14, Pashinyan accepted an invitation from Russian President Vladimir Putin to attend the annual May 9 Victory Day celebrations in Moscow to mark the end of World War II (Azatutyun, April 15). Last year, Pashinyan did not attend. This move has been taken as a step to defuse what had been growing antagonism between Armenia and Russia (Eurasianet, March 25). Six days following the invitation, Pashinyan was believed to have instructed officials to resume contact with their Russian counterparts (Business Online, March 20).
Diversifying away from Moscow does not necessarily mean abandoning Armenia's aspirations to further integrate with the European Union completely. Armenia still relies on Moscow for most of its economic and energy needs, while Yerevan still lacks an open border with Turkiye, central for the European Union to make inroads into Central Asia via the South Caucasus (ArmenPress, April 4). That stated aim has already irked Baku, which also views this as a way to marginalize Georgia, given its souring relations with the European Union (Topchubashov Center, April 8; Caliber, April 11).
For now, Pashinyan must balance westward aspirations with the ever-present shadow of Russia and an increasingly assertive opposition at home. If he can offer voters a compelling vision of a "Real Armenia"--one that overcomes military defeat, economic stagnation, and regional isolation--he might still chart a path to re-election. The 2018 Velvet Revolution, however, feels distant for most Armenians now, as demonstrated in Gyumri. The loss of Karabakh and the attempted control of power in the regions of Armenia define his tenure today (Civilnet, November 27, 2024).
On the eve of the first Gyumri council meeting, Pashinyan's predecessor, Serzh Sargsyan, lambasted his own forerunner, Robert Kocharyan. Both accuse each other of facilitating Pashinyan's rise to power in 2018 (Azatutyun, April 15). Pashinyan has so far been fortunate that no alternative third force could unite a large part of the population that neither supports him nor the opposition. This, however, still risks electing a hung parliament for the first time in Armenia's post-independence history.
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Onnik James Krikorian is a journalist and consultant from the United Kingdom who has been based in the South Caucasus since 1998. He has worked for British regional, national and international media and covered the Armenia-Azerbaijan conflict since 1994.
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Original text here: https://jamestown.org/program/armenian-local-elections-a-barometer-for-pashinyans-political-future/
[Category: ThinkTank]
IMF and World Bank Meetings to Take Place Amid Unprecedented Uncertainty Around US Role in Global Economic System
WASHINGTON, April 22 -- The Center for Economic and Policy Research issued the following news release on April 21, 2025:
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IMF and World Bank Meetings to Take Place Amid Unprecedented Uncertainty Around US Role in Global Economic System
Washington, DC -- The Spring Meetings of the International Monetary Fund and the World Bank will take place in Washington this week, facing considerable challenges in the face of plummeting global confidence due to the Trump administration's trade shock, economist Mark Weisbrot, Co-Director of the Center for Economic and Policy Research, noted today.
"Trump's
... Show Full Article
WASHINGTON, April 22 -- The Center for Economic and Policy Research issued the following news release on April 21, 2025:
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IMF and World Bank Meetings to Take Place Amid Unprecedented Uncertainty Around US Role in Global Economic System
Washington, DC -- The Spring Meetings of the International Monetary Fund and the World Bank will take place in Washington this week, facing considerable challenges in the face of plummeting global confidence due to the Trump administration's trade shock, economist Mark Weisbrot, Co-Director of the Center for Economic and Policy Research, noted today.
"Trump'sfirst 90 days in office have shaken the global economy and suddenly added a wave of uncertainty and volatility to markets and economic decision-making," he said. "There have long been calls for governance reform at the IMF and World Bank, and other institutions that are often described as multilateral and pillars of the 'rules-based international order.' This current crisis is one of the most compelling examples of why the IMF needs to be reformed and become a real multilateral organization.
"It's bad enough to have the world's most powerful multilateral financial institution so dominated in its decision-making by one country," Weisbrot said. "But much worse when that country becomes an unreliable partner in international trade and commerce."
Although the IMF has 189 member countries, it is well known to observers and the executive directors who represent countries at the Fund that the United States holds sway over almost all decision-making. The most important decisions require 85 percent of the votes in order to be approved, and the US has 16.5 percent of the votes and therefore a veto. But other votes decided by a majority vote of the Executive Board almost always deliver a US government win. This is because the other high-income countries, most of them in Europe, generally vote with the US -- and together they have more than 60 percent of the vote.
The IMF has come under fire for decades for attaching conditions to its lending that have worsened the economies of the borrowing countries. These have included "procyclical" policies -- i.e., cutting government spending and/or raising policy interest rates while the economy is already weak, or in recession -- as the IMF has itself recently acknowledged.1 The control of the IMF by Washington and its allies has prevented the reforms necessary for developing countries to get balance of payments support when needed, without these harmful conditions that often leave them struggling with debt for years.
But this is the first time that the US government is actually delivering a "tariff shock" to the global economy, which can impact many countries -- including the United States.
At the IMF's curtain-raiser event on April 17, IMF Managing Director Kristalina Georgieva highlighted the tariffs as a reason why the IMF will now lower its global economic growth forecasts.
"The U.S. effective tariff rate has jumped to levels last seen several lifetimes ago," she said. She noted that "uncertainty is costly ... in a world of bilateral tariff rates, each of which may be moving up or down, planning becomes difficult." In addition to reduced economic growth, she noted that "we will also see markups to the inflation forecasts for some countries."
"The IMF's governance is a relic from when the organization was formed in 1944 when more than a third of the world's population did not live in independent countries," Weisbrot said. "The United States and its allies made the rules that we see today.
"But the world has changed, and these rules look even worse today than they did then. Hopefully this latest episode will help force the necessary voting reforms."
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1. See especially page 105, "Neglected Pro-cyclical Effects of Fiscal Consolidation."
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Original text here: https://cepr.net/newsroom/imf-and-world-bank-meetings-to-take-place-amid-unprecedented-certainty-around-us-role-in-global-economic-system/
[Category: ThinkTank]
Heritage Foundation Mourns the Death of Pope Francis
WASHINGTON, April 22 -- The Heritage Foundation issued the following statement on April 21, 2025:
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The Heritage Foundation Mourns the Death of Pope Francis
WASHINGTON--Dr. Kevin Roberts, president of The Heritage Foundation, released the following statement today mourning the death of Pope Francis:
"With reverence, The Heritage Foundation mourns the death of Pope Francis. He was a simple man who reminded the Catholic Church to live with mercy and joy, and we remember his pontificate with gratitude and prayer. "Pope Francis' death coincides with a season called Eastertide, in which Catholics
... Show Full Article
WASHINGTON, April 22 -- The Heritage Foundation issued the following statement on April 21, 2025:
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The Heritage Foundation Mourns the Death of Pope Francis
WASHINGTON--Dr. Kevin Roberts, president of The Heritage Foundation, released the following statement today mourning the death of Pope Francis:
"With reverence, The Heritage Foundation mourns the death of Pope Francis. He was a simple man who reminded the Catholic Church to live with mercy and joy, and we remember his pontificate with gratitude and prayer. "Pope Francis' death coincides with a season called Eastertide, in which Catholicsrecall that our Resurrected Lord, Jesus Christ, walked with his disciples. Let us unite in prayer that Pope Francis may also walk with the Resurrected Jesus Christ today. "Eternal rest grant unto Pope Francis, O Lord, and let perpetual light shine upon him. May he rest in peace."
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Original text here: https://www.heritage.org/press/the-heritage-foundation-mourns-the-death-pope-francis
[Category: ThinkTank]
Center of the American Experiment Issues Commentary: Tale of Two Eras - Minnesota Math Over the Years
GOLDEN VALLEY, Minnesota, April 22 -- The Center of the American Experiment, a civic and educational organization that says it creates and advocates policies, issued the following commentary on April 21, 2025:
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A tale of two eras: Minnesota math over the years
Written by Catrin Wigfall
Five years after COVID-19, it is obvious there are still lingering effects of school closure policy decisions, as achievement remains lower than pre-pandemic performance and long-term consequences have yet to be fully realized.
Perhaps what is less well-known, though, is that achievement was suffering declines
... Show Full Article
GOLDEN VALLEY, Minnesota, April 22 -- The Center of the American Experiment, a civic and educational organization that says it creates and advocates policies, issued the following commentary on April 21, 2025:
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A tale of two eras: Minnesota math over the years
Written by Catrin Wigfall
Five years after COVID-19, it is obvious there are still lingering effects of school closure policy decisions, as achievement remains lower than pre-pandemic performance and long-term consequences have yet to be fully realized.
Perhaps what is less well-known, though, is that achievement was suffering declinespre-COVID. Until about a decade ago, Minnesota math scores were generally on the rise (2003-2013), with achievement gains on national math assessments broadly shared not only among higher-performing students but their lower-performing peers as well. Then scores started to fall, and achievement was further impacted by COVID-19 and school closure policy decisions (2013-2024).
It's a tale of two eras, as Chad Aldeman with The 74 describes it. A look at Minnesota eighth-grade math performance, for example, which has links to long-term life outcomes, shows that from 2003-2013 lower-performing students' scores on the National Assessment of Educational Progress (NAEP) increased four points. Average student scores also increased four points, with higher-performing student scores increasing nine points.
This growth happened despite education funding changes during this time period, which Education Minnesota, the teachers' union, continues to claim are responsible for the state's current education woes. Yet years of education spending increases since then have not meaningfully improved student outcomes or closed achievement gaps. Also passed during this time period was Q Comp, an alternative teacher professional pay system aimed at supporting and rewarding excellence in teaching.
From 2013-2024, NAEP scores for lower-performing students declined 17 points, average scores declined 13 points, and higher-performing scores declined 10 points.
The declines also include diverging achievement gaps between the highest performers (90th percentile) and lowest performers (10th percentile), continues Aldeman, which are being hidden by student average scores.
What's behind the achievement declines? Not declines in education funding.
It would appear changing accountability pressures, for one, according to Aldeman. When then-President Barack Obama announced in 2012 that he was granting state waivers from the federal No Child Left Behind Act, he "waved away the notion that all schools needed to make 'adequate yearly progress' for all students and for individual student groups."
Even though the No Child Left Behind Act wasn't especially popular, schools were required to demonstrate their success in terms of the academic achievement of every student. Its accountability pressures resulted in "a decade-plus of small but significant gains" that while were "perhaps smaller than policymakers and educators might have preferred" were broadly shared, continues Aldeman.
When those school and district accountability pressures were relaxed by Obama, it set off "a decline in student performance across the country," writes Aldeman. When the Every Student Succeeds Act was passed and then signed by Obama in 2015, "achievement scores had already begun to fall" and the "declines were uneven."
Fast forward to today, and declining U.S. math performance is impacting the country's international rankings.
This of course is just one example of policy impacts at the federal level. Decisions at the state level impact student achievement, too (such as examples noted above). For the second year in a row, majorities of Minnesota students are not meeting grade-level benchmarks in math, as measured by the state's assessments.
With just a handful of weeks remaining this session, the Minnesota Legislature still has an opportunity to prioritize achievement-focused education initiatives so that the state's public education system can fulfill its statutorily required mission of "ensur[ing] individual academic achievement." The good news is that achievement growth is possible, and introducing a bottom-up approach to the system is one piece of refocusing K-12 education to this priority.
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Minnesota, National Assessment of Educational Progress 2003-2013
Minnesota, National Assessment of Educational Progress 2013-2024
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Catrin Wigfall is a Policy Fellow at Center of the American Experiment.
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Original text here: https://www.americanexperiment.org/a-tale-of-two-times-minnesota-math-over-the-years/
[Category: ThinkTank]
American Action Forum: Tracker - Federal Reserve's Balance Sheet Assets
WASHINGTON, April 22 -- The American Action Forum issued the following commentary on April 21, 2025:
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Tracker: The Federal Reserve's Balance Sheet Assets
By Thomas Kingsley
Introduction
This tracker follows the Federal Reserve's (Fed) total consolidated assets, held on its balance sheet, as the best indicator of the Fed's direct intervention in the economy.
Context
The Fed's dual mandate requires it to ensure both stable prices and maximum employment. The traditional tool the Fed uses to accomplish these goals is the adjustment of the federal funds rate, the short-term interest rate
... Show Full Article
WASHINGTON, April 22 -- The American Action Forum issued the following commentary on April 21, 2025:
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Tracker: The Federal Reserve's Balance Sheet Assets
By Thomas Kingsley
Introduction
This tracker follows the Federal Reserve's (Fed) total consolidated assets, held on its balance sheet, as the best indicator of the Fed's direct intervention in the economy.
Context
The Fed's dual mandate requires it to ensure both stable prices and maximum employment. The traditional tool the Fed uses to accomplish these goals is the adjustment of the federal funds rate, the short-term interest ratethat determines how much it costs for banks to lend to each other overnight. The 2007-2008 financial crisis, however, demonstrated that even lowering the interest rate to zero was considered insufficient to shore up economies in freefall, and the Fed turned to more unusual tactics. One of these measures was what the Fed refers to as "large-scale asset purchases," which is more commonly known as "quantitative easing." Under this process, the Fed enters the market to buy securities, typically mortgage-backed securities (MBS) and Treasuries, injecting both capital and liquidity into the market. This approach is not without risks - for the first time in its history, the Fed is regulator, supervisor, and now participant in the economy.
The development of quantitative easing as a go-to tool for the Fed in times of crisis has led to an unprecedented focus on one of its traditionally unremarkable aspects - the Fed total assets. Just as with any other firm, securities that the Fed purchases are considered assets and therefore are represented on the Fed's balance sheet. This therefore is the most reflective guide of the state of quantitative easing and, by extension, the degree to which the Fed has deemed it necessary to intervene in the economy.
Each week, the Federal Reserve publishes its balance sheet, typically on Wednesday afternoon around 4:30 p.m.
As of April 16, the Fed's assets stand at $6.7 trillion.
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Thomas Kingsley is the Director of Financial Services Policy at the American Action Forum.
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Original text here: https://www.americanactionforum.org/insight/tracker-the-federal-reserves-balance-sheet/
[Category: Think Tank]
American Action Forum: 2025 Foreign Pollution Fee Act - Revenue Effect and Analysis
WASHINGTON, April 22 -- The American Action Forum issued the following commentary on April 21, 2025:
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The 2025 Foreign Pollution Fee Act: Revenue Effect and Analysis
By Shuting Pomerleau
Executive Summary
* On April 8, Senators Bill Cassidy (R-LA) and Lindsey Graham (R-SC) reintroduced the 2025 Foreign Pollution Fee Act, which would levy tiered and escalating tariffs on selected imported goods based on their carbon emissions; the legislation is aimed at boosting U.S. manufacturers' competitiveness in low-carbon goods and raise tax revenue.
* The tariffs would raise an estimated $133.6
... Show Full Article
WASHINGTON, April 22 -- The American Action Forum issued the following commentary on April 21, 2025:
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The 2025 Foreign Pollution Fee Act: Revenue Effect and Analysis
By Shuting Pomerleau
Executive Summary
* On April 8, Senators Bill Cassidy (R-LA) and Lindsey Graham (R-SC) reintroduced the 2025 Foreign Pollution Fee Act, which would levy tiered and escalating tariffs on selected imported goods based on their carbon emissions; the legislation is aimed at boosting U.S. manufacturers' competitiveness in low-carbon goods and raise tax revenue.
* The tariffs would raise an estimated $133.6billion from 2026-2035 if it is enacted in addition to current-policy tariffs, and $185.4 billion over the same period if enacted in isolation.
* Top exporting economies affected by the tariffs would include Canada, China, Mexico, Vietnam, India, Taiwan, and Thailand.
Introduction
On April 8, 2025, Senators Bill Cassidy (R-LA) and Lindsey Graham (R-SC) reintroduced the 2025 Foreign Pollution Fee Act (FPFA) , which would levy tiered and escalating tariffs on selected imported goods. The legislation is aimed at boosting U.S. manufacturers' competitiveness in low-carbon goods and raise tax revenue.
This research finds that these tariffs would raise an estimated $133.6 billion from 2026-2035 if enacted in addition to current-policy tariffs, and $185.4 billion over the same period if enacted in isolation. Top exporting economies affected by the tariffs would include Canada, China, Mexico, Vietnam, India, Taiwan, and Thailand.
The American Action Forum previously released a brief analysis of the legislation. This piece provides an analysis of the revenue effects of the carbon tariff proposal.
Overview and Analysis of the 2025 Foreign Pollution Fee Act
The FPFA would levy tariffs on eight sectors of imported goods based on their carbon emissions:
* Objective: According to the press release, the legislation is intended to "level the playing field for American manufacturers and workers by holding non-market economies like China accountable for their unfair trade practices."
* Tariff Rates: The country- and product-specific tariff rate is a variable rate set in a multi-tiered tariff framework that is applied as a percentage of the custom import value of a good. The FPFA only specifies 25 countries' tariff rates; the world's remaining countries, including 19 Organization for Economic Co-operation and Development (OECD) countries, are subject to the same set of rates for covered goods. (See Table A in the appendix.) The specified tariff rates are applicable in the initial three years of the FPFA's implementation, before the variable charges are updated based on the criteria listed in the legislation.
* Tax Base: The proposal covers aluminum, cement, iron and steel, fertilizer, glass, hydrogen, and certain inputs for solar and battery manufacturing.
* Exemptions: The proposal allows exemptions of certain imported goods if they are deemed necessary for national defense purposes, or if the country of origin of the covered goods participates in the "international partnerships" program to levy "interoperable methods to promote pollution reduction through trade mechanisms."
* Additional Punitive Tariffs: The legislation includes provisions to escalate the tariff rates to double or quadruple the size of the variable charge if the covered goods are imported from a "nonmarket economy country" or manufactured by a "foreign entity of concern." For example, if a country is considered a "nonmarket economy country," the tariff rates of the covered iron and steel goods produced by a "foreign entity of concern" in this country would be subject to a multiplier of four.
* Anti-avoidance Measures: The legislation also gives relevant agencies the authority to escalate the tariff rates to a level "deemed necessary to offset or deter such evasion" to discourage foreign producers' attempts to reroute their exports to avoid paying the tariffs.
The 2025 FPFA would not have a material impact on emissions reduction. This is because the proposal would levy country-specific tariffs across different covered sectors, which would discourage individual foreign producers from lowering their emissions to reduce tariffs on their goods. Additionally, the FPFA does not include any domestic carbon price, and thus there is no incentive for U.S. producers to lower their carbon emissions.
Revenue Estimate
This research finds that - considering the 2025 FPFA's tax rate, tax base, behavioral responses, the effects of the tariffs on income and payroll tax revenue, and the current policy tariffs (see Table B and Table C in the appendix) - the 2025 FPFA would raise up to $133.6 billion in net revenue from 2026-2035 if the FPFA tariffs are stacked on current-policy tariffs, and $185.4 billion excluding current-policy tariffs.
These are likely upper-bound estimates as they do not account for any potential tariff exemption or reduction for national security purposes or through the International Partnership Agreement, nor do they include any potential foreign retaliation, which would reduce taxable income in the United States.
The FPFA's high tariff rates would result in a significant reduction in imported goods. The legislation's imports reduction would be exacerbated if its tariffs are combined with current-policy tariffs. For example, the value of covered FPFA goods from China would drop 87 percent if the FPFA's tariffs were added to current-policy tariffs.
The United States' major trading partners, such as Canada, China, Mexico, Vietnam, Thailand, India, and Taiwan are top exporters that account for a relatively large share of the total tariff revenue collected, especially Canada, China, and Mexico. (See Table 2)
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Shuting Pomerleau is the Director of Energy and Environmental Policy at the American Action Forum
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Original text here: https://www.americanactionforum.org/insight/the-2025-foreign-pollution-fee-act-revenue-effect-and-analysis/
[Category: Think Tank]
