(1) It doesn't measure the vast majority of serices, mostly goods. The service sector in the trade deficit is something like 16 percent. The service sector in our economy is about 75 percent. So we are exporting a lot of services that don't get accounted for. Everything from software, engineering and accounting services, medical treatments, on and on. So virtually no one who is informed thinks the real trade deficit is really anywhere near $500 billion. For most of the last few decades it's likely been positive if services were accounted for.
(2). The numbers aren't real. Just for example, how many eBay dealers ship stuff overseas and report the real value? Yet the numbers on those forms are what's used to calculate the deficit. For the most part, the numbers are fiction.
(3) The real issue is cash transfers. If we are importing more goods than we export, but foreigners are investing the profits and more back here by buying our stocks and bonds, that's a net positive for us in terms of cash flow. Cash transfers have been down over the past few years, but we remain the safest investment in the world. A lot of that confidence would get shaken if we started imposing trade barriers.
(4) Trade is not an equal sum game. Say you have lemons and I have eggs. If we trade we can both make lemon meringue pie. That's a new gain for both of us. If we restrict trade, we only limit our choices. Compound that by thousands of products over hundreds of countries and $500 billion (even if it were real, which it is not) is a spit in the bucket compared to the economic value of expanded trade on our standard of living.
There are quite a few other reasons for supporting free trade, including the need for global competition for American companies, and the avoidance of trade wars. The bottom line is that trade barriers are an artificial constraint on the economy. They are worse than taxes in many respects, and should be avoided at all costs. Educated and responsible economists have known this for several decades and for the most part the political class should be lauded for standing up to the political pressure from special interests that seek to skew the game in their favor at the expense of America's standard of living.
That's it? That's supposed to be the profound question by which free traders fail to respond? It's very easy to describe what the US would be like with a $500B surplus - it would be like Japan.
It would have a very high currency value and wages relative to other countries, which would force it to move its productive capacity offshore to other lower cost counties (Korea/Taiwan/Malaysia/Mexico), including its primary market (US), in order to compete in export trade.
In the home country, people would protest that jobs/investment were moving offshore (true), while the target countries would benefit from the job creation and net capital inflows.
Because its currency value would be so high, the country would experience limited if not a complete absence of tourism, thereby destroying that part of the economy. [Aside: I see zillions of Japanese tourists in CA; I've personally been to many regions in the world, but have no plans on visiting Japan where bottles of beer cost $10.]