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The new U.S. tariffs rattling markets and promising globe-spanning trade barriers reflect a fixation of President Trump’s: the difference between how much stuff the U.S. buys from and sells to each of its trading partners.

The White House laid out new tariffs on more than 200 countries in two main ways. For more than half, it imposed a flat reciprocal tariff of 10%. For the rest, it added an additional levy based on a basic formula.

In these instances, the Trump administration determined costs it said countries imposed by taking the amount of a nation’s 2024 goods-trade imbalance with the U.S., then dividing that by the value of the goods America imports from that nation.

A White House handout called these costs a tariff charged to the U.S., “Including Current Manipulation and Trade Barriers.” From there, in nearly all cases, the Trump administration imposed new “Discounted Reciprocal Tariffs” of roughly half that result.

“Drop your trade barriers…and start buying tens of billions of dollars of American goods,” Trump said Wednesday.

Several economists said that basing tariffs off of bilateral goods deficits is confusing and illogical.

Learning of the tariff formula “was like watching a movie, and at the end of it, you’re like, ‘That’s it?’” said David Beckworth, a senior research fellow at George Mason University’s Mercatus Center.

Beckworth said a more holistic approach would have taken services trade into account, too—like tech and education the U.S. sells to foreigners. Unlike with goods, America has run an overall services trade surplus for decades, including with most of the nations receiving reciprocal tariffs.

Goods deficits are a normal feature of healthy trade and “do not imply that anything is wrong,” said Gian Maria Milesi-Ferretti, a senior fellow at the Brookings Institution.

Take a relatively poor country that mostly exports coffee to the U.S. Its citizens might lack the wealth to buy the kinds of high-value goods, such as Boeing aircraft or Tesla SUVs, that American factories specialize in. But that is no reason to discourage that country’s coffee from reaching American consumers—especially because few places in America have the right climate to grow coffee domestically, Milesi-Ferretti said.

The U.S. added reciprocal tariffs on several less-wealthy coffee exporters such as Guatemala and Honduras.

The White House figures initially confused economists because they didn’t seem to correspond with what foreign countries actually charge against imports from the U.S.

For example, Chinese tariffs against the U.S. were about 23% overall as of last month, according to the Peterson Institute for International Economics. The White House chart said China’s tariffs and trade barriers were 67%. In response, the White House added new tariffs of 34% atop levies already charged to that country.

Data sleuths on social media soon reverse-engineered the formula behind the White House’s calculations, zeroing in on the trade-related math. Dividing the U.S.’s 2024 goods-trade deficit with China—$295 billion—by the amount the U.S. imported from China resulted in the White House’s 67%.

The Wall Street Journal followed calculations highlighted in postings on social media, including by journalist James Surowiecki, a former business columnist for the New Yorker. The Journal found the calculations explained the costs attributed to nearly 100 countries, including all of the European Union, which the White House treated as a single bloc.

In a post on its website Wednesday, the office of the U.S. Trade Representative blamed persistent trade deficits for the loss of manufacturing jobs. It said it calculated the tariff rates that would reduce trade deficits with specific countries to zero, rates it calls “reciprocal and fair.” In justifying its math, the post cites a handful of research papers on tariffs and trade deficits.

“Reciprocal tariffs are calculated as the tariff rate necessary to balance bilateral trade deficits between the U.S. and each of our trading partners,” the USTR said.

Some of the researchers cited by USTR questioned the math and the basic premise that tariffs can reduce the trade deficit to zero, when reached by the Journal. Pau Pujolas, an economist at McMaster University in Canada, said tariffs don’t generally do much to reduce trade deficits.

Trade is complicated, and tariffs can have all sorts of unintended consequences. On the one hand, tariffs are likely to raise prices of imported goods. But if the economies and currencies of exporting countries take a hit as a result of tariffs, that may push the price of their export goods down again. “What the tariffs do is simply impoverish your neighbor and make sure that you can import more cheaply,” he said.

Another economist cited, Purdue University’s Anson Soderbery, said his paper “was entirely written to combat” arguments like those made by the USTR.

The USTR didn’t immediately respond to a request for comment.

His study found that in some cases, the benefits of tariffs can outweigh the costs. But the key is to carefully calculate which tariffs do more good than harm, rather than adding new tariffs in bulk on all countries that run a trade surplus with the U.S., Soderbery said.

He said it shouldn’t be the goal to get all trade deficits to zero. Imports can be beneficial because they free up U.S. workers to focus on more valuable work, like software engineering.

“Do we want to trade our high-tech, high-skilled-labor service industries for production of avocados?” Soderbery said. “We can do it but I’m not sure why we want to.”