Even by Donald Trump’s standards, it is a weird statement to have made.
The American president has been critical of US trade practices with other countries for a long time. Having already committed himself to renegotiating the terms of the North American Free Trade Agreement (NAFTA), Trump recently imposed heavy tariffs on Chinese goods, leading the Asian nation to compare Trump’s actions to “bullying.”
Now Trump has raised the possibility of whether the US gains anything at all by trade, an assertion which is making heads spin. As reported by Reason, during a speech to steelworkers in Granite City, Illinois this week, Trump said it would probably be better for America to not bother itself with international trade at all.
“Our trade deficit ballooned to $817 billion. Think of that. We lost $817 billion a year over the last number of years in trade. In other words, if we didn’t trade, we’d save a hell of a lot of money.”
As noted by the U.S. Census Bureau, Trump’s figures about the trade deficit are grossly exaggerated — by at least 48 percent. But that is not even the tip of the problem, if one considers Trump’s penchant for distorting figures. What is far more troubling, say observers, is Trump’s “fundamental misunderstanding” of seeing trade as a zero-sum endeavor towards economic exchange.
"If we didn't trade," Trump argues, "we'd save a hell of a lot of money." But he loves trade! https://t.co/OgoWDnLx4D
— reason (@reason) July 27, 2018
What Trump seems to have ignored, trade specialist Scott Lincicome argues, is that even if we saved tonnes of money by not doing trade, we’d have scarcely few things to spend that money on.
“Without trade, we could have piles of money,” Lincicome told the New York Times. “But we’d have no food, clothing, housing, etc. So the money would be worthless, unless you swam in it like Scrooge McDuck or something.”
It is not clear whether or not Trump’s statement about trade having inherently no function was earnest, as the president has repeatedly oscillated when it comes to his views on trade. While sometimes he seems to value trade and “aims to promote it with his can’t-lose war,” at other times he appears strangely clueless about how international trade functions, as was apparent during his rally in Illinois.
“I’m a free trader, 100 percent,” Trump had said about trade during the 2015 Republican primaries. “But we need smart people making the deals, and we don’t have smart people making the deals.”
But at other times, Trump has seemed deeply oblivious to the very nature of international trade, like the time when he claimed that “tariffs are the greatest” and that “trade wars are good and easy to win.”