No, “trade deficit” is another misleading modern-day term, like “liberal” or “feminist”. Again, if I go to the store and buy $100 worth of grocers, is that a “problem”? Of course not. I’ve received goods for dollars - a fair trade, beneficial to both parties.
An historical example of the absurdity of this thinking is tiny little Hong Kong perched on a rocky peninsula with no natural resources of its own. Yet it became an economic powerhouse. How did it do that? Hong Kong didn’t have any natural resources so all they could do was import goods - “trade deficits”. And yet Hong Kong became an economic giant. How? Because they thrived on a market economy that was essentially free of government interference including no sales or income tax.
Hong Kong has a smaller population than Pennsylvania, and has a per person GDP nearly 20,000 less than the US.
Playing middle man broker for other folks trade can work to help you make some cash, but it isn’t a viable option for a nation of 330 Million. Trying to compare HK to the US is patently absurd.
HK is sort of like the San Fran or SEATAC of the asian rim... lots of goods going elsewhere flow through it, causing a lot of centralized wealth from it, but it isn’t something that flows out or scales up. Playing a broker by a small state and taking a margin works for HK, it doesn’t work for a country like the US. SF and SEATAC are examples... those ports get a lot of wealth, because huge amounts of goods sold throughout the rest of the country flow through there, but they are just middle men taking a cut, not producing anything and that wealth doesn’t flow to the rest of the nation where those goods are actually consumed.
Partly true, and therefore misleading. What you fail to add to the equation is that goods are not only bought and sold, but PRODUCED.
WHERE they are produced makes a huge difference. I say that as a resident of Washington State, with domestic and international exporters such as Microsoft and Boeing.
OF COURSE it matters where the dollars go. Just ask those who receive the paychecks.
OK, so I checked, the trade deficit is about 365 bill for 2015. Total trade near 500 bill. They put tariffs on our goods, cheating the agreement in other words, which keeps our companies out of their country. We should, of course, declare they have abrogated the trade agreement and either renegotiate or apply an equal tariff to their products. Our p-whipped government doesn’t do that though, they just obfuscate and let the Chinese (and others) continue to cheat. That is what Mr. Trump means to stop.
A free people shouldn't prop up regimes which are using unfair advantages to engage in their trade. Advantages such as slave labor or near-slave labor, or widespread pollution, etc. In cases such as that, there should be a moral dimension to trade policy.