Last summer, as Donald Trump’s trade war started to take shape, the Republican president told Fox News he believed he could cut the U.S. trade deficit in half. It came two years after Candidate Trump assured voters his agenda would be so successful, Americans would see a drop in the trade deficit “like you’ve never seen before.”
President Trump’s trade war has led to even bigger trade deficits with China, even though it was intended to improve the trade balance. But it’s not just China – the deficit has increased with most of our other major trade partners, too.
While economists agree that trade deficits aren’t a good way to measure a trade relationship, they are the metric Trump fixates on, made campaign promises about and uses to evaluate relationships with other countries.
Axios’ report on this, published yesterday, added that the U.S. trade deficit covering the first six months of 2019 is “even bigger than in the last two years.”
Ordinarily, I wouldn’t consider a widening trade deficit especially notable. All things considered, it’s just not that important.
But as regular readers know, Trump has long been obsessed with the trade deficit. It’s never been altogether clear whether he fully understands what it is – the president has occasionally talked about the trade deficit in a way that suggests he’s badly confused – but Trump has nevertheless labeled it an economic scourge that he’s determined to address. In the Republican’s mind, a trade deficit is evidence of “lost” money,
Indeed, the president has based much of his trade war on the idea that it would reduce the nation’s trade deficit – which means Trump’s agenda isn’t just failing in a general sense, it’s also failing by the metric the Republican has told everyone to care about.
* Postscript; In February, relying on cherry-picked figures, Trump insisted that his administration was actually shrinking the trade deficit. As Glenn Kessler explained soon after, “The president keeps seizing on scraps of data – a month here or a quarter there – to falsely claim the trade deficit is being reduced. But over the course of the year, it kept growing. Attributing a small one-month shift to tariffs is especially silly.”
If Trump wanted to argue that the trade deficit isn’t especially important, that would be fine, since it really isn’t especially important. If he wanted to argue that all presidents have limited control over the trade deficit, that would work, too.
Instead, he’s going out of his way to do all of this wrong.