US Trump Tariff: 71 major companies declare bankruptcy; is America's long-term economic stability threatened?
Since returning to power, U.S. President Donald Trump has implemented a series of controversial decisions aimed at fulfilling his 'Make America Great Again' campaign promise. One of the key strategies has been the imposition of heavy tariffs on various countries, which he believes will bolster the U.S. treasury and encourage domestic investment. However, these policies appear to be having adverse effects on the American economy.
In July, the U.S. saw 71 major companies declare bankruptcy, marking the highest number since the onset of the COVID-19 pandemic in 2020. This surge in bankruptcies contributed to a major budget deficit, which reached $291 billion—a $47 billion increase (19 percent) from the previous month. This figure represents the second-largest deficit recorded for July in U.S. history, surpassed only by the deficit in 2021.
446 companies have gone bankrupt in the U.S. this year
In total, 446 companies have gone bankrupt in the U.S. this year, the highest number in 15 years. This surpasses the total bankruptcies recorded in both 2021 (405 companies) and 2022 (373 companies). The industrial sector, with 70 bankruptcies, and consumer discretionary sector, with 61, have been particularly hard hit.
Budget deficit increases
The U.S. Treasury Department reported that the budget deficit reached $291 billion in July, up from $27 billion in June. Government spending rose by 9.7 percent to $630 billion, the highest level since January, while revenue increased by 2.5 percent to $338 billion, including $29.6 billion from tariffs. This has pushed the total budget deficit for the year to $1.63 trillion, positioning the U.S. on a path toward its third-largest budget deficit in history.
As President Trump continues to impose tariffs on foreign nations, the U.S. economy faces mounting challenges. The U.S. government's Gross National Debt has surpassed $37 trillion, with the alarming rate of increase at $1 trillion every five months. This raises concerns about the long-term economic stability of the nation.
Prakash Kumar Pandey