Trump’s Tariffs Aren’t the Only Way to Shrink the Trade Gap

Is there a better way to reduce the U.S. trade deficit than raising duties on imports? A lot of economists say yes. Some of their ideas are old, some new, and some a little strange. All have been given new life by the Trump administration’s tariff offensive, which has sparked fears of a global trade war.

Economists who specialize in trade, coming from both the right and the left, mostly agree with President Trump that big and persistent U.S. trade deficits are a problem, particularly for American workers whose jobs have been displaced by imports. But trade experts say he’s wrong to imply deficits are necessarily a sign that a trade partner is cheating. Mexico, for instance, has a surplus with the U.S., but it runs a deficit with the world as a whole in its current account, the broadest measure of trade in goods and services.