Ten Quick Facts about US Trade: Deficits and Discords

Abstract

Acting on his campaign rhetoric that China is “raping our country,” Donald Trump recently announced additional tariffs on $ 200 billion of Chinese imports. This was on top of earlier tariffs on $ 50 billion worth of imports, including a 25 percent tariff on steel, 10 percent on aluminum, 30 percent on solar panels, and 20–50 percent on washing machines—products he alleged are being “dumped” by the Chinese—and threatened a “trade war” against that country. The objective of this article is to present 10 salient facts (not opinions) about US trade in the wake of the aggressive stance taken by the Trump administration. Certainly, as this article shows, there will be “winners” as well as some “losers” within a nation as it opens itself up to more international trade. But the key argument is that, on average, a nation is better off because the benefits that accrue to the winning firms and consumers generally significantly exceed the pain, suffering, and angst borne by the losers.

Keywords: trade, USA, China, trade balance