President Donald Trump’s approach to international trade is driven to a large extent by his belief that the United States is being unfairly treated by other countries.
His main supporting evidence is the trade deficit – the US buys more than it sells internationally.
He has referred to the deficit as losing money. In one tweet he wrote about losing $500bn (£388bn) a year as a result of crazy trade with China. No more, he promised.
One of his central economic objectives has been to reduce it. In November 2017, his first year in office, he referred to the total deficit with all trade partners of almost $800bn a year as unacceptable. He said: “We are going to start whittling that down, and as fast as possible”.
But it hasn’t come down. The figure that President Trump referred to was for trade in goods alone. It has increased in both of the full years since he took office.
It was $750bn in the final year under President Barack Obama, $887bn in 2018, and the increase has continued. We have figures for the first nine months of this year, showing the deficit was larger, though only slightly, than in the same period of 2018.
Mr Trump focuses on bilateral deficits, often suggesting they are evidence of the unfair actions of the other country concerned.
The deficit with China is by far the largest. It rose in Mr Trump’s first two years, but for the first nine months of 2019 it is lower. Both imports and exports have fallen, imports by more.
That is hardly surprising as the two countries have applied increased tariffs to large swathes of one another’s goods.
So a success for President Trump? Only if you think bilateral trade balances really matter. And most economists think they don’t.
Getting one bilateral deficit down does not guarantee you reduce the overall deficit. The deficit with China may be down, but others have increased – Vietnam, Mexico and Taiwan for example.