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The context here is that president Trump has an interesting view of trade deficits / surpluses. Specifically, he frequently cites cases where the US has a trade

by kemayo 1mo ago

The context here is that president Trump has an interesting view of trade deficits / surpluses. Specifically, he frequently cites cases where the US has a trade deficit with another country -- where the US is spending more in that country than that country is in the US -- as if that country is "taking money" from the US. This is a bit peculiar, because it ignores the whole "the money we are spending is being exchanged for goods that come back to the US" part of the trade. I.e. it's not a problem that I have a "trade deficit" with the grocery store, because I have my groceries. https://finance.yahoo.com/economy/policy/articles/trump-brags-growing-trade-deficit-143446726.html https://finance.yahoo.com/economy/policy/articles/trump-brag...

poncho_romero 1mo ago
It also excludes money spent on services, which in most cases favours the US.
- kemayo 1mo ago
  Look, my trade deficit with my barber is a real problem in our relationship. I need them to give me $20 for something, damnit.
- giantrobot 1mo ago
  > which in most cases favours the US Used to favor the US. Trump's policies and behaviors are ruining the US' reputation as a stable trading partner by demonstrating what damage can be done by an idiot with unchecked power. The rest of the world is going to permanently veer away from US services because it's not impossible (and sadly likely) another feckless imbecile will get put in charge.
inigyou 1mo ago
Actually you, like most of us, have a trade deficit with the grocery store and the movie theater, and a trade surplus with your employer. Which one is more enjoyable to have?
- kemayo 1mo ago
  The experience of the trade deficit with the grocery store and the movie theater is more enjoyable, overall. I get films and ice cream and a good time out of it. From my employer I get a lot of sitting in meetings -- they have to pay me to make me put up with that! My point is that reducing it entirely to "did I gain or receive cash-money from this?" isn't a particularly useful framing.
  - jimkleiber 1mo ago
    I think it's what can happen when we shift more towards an exchange orientation and away from a communal orientation. Or in other words, as we see the world more win-lose and less win-win.
  - inigyou 1mo ago
    Yeah that's the point. If you can get away with having a trade deficit not balanced by a surplus, that's a good thing because you get more movies and ice cream for less meetings. Trade deficits are good, people are just sending you free stuff.
- tshaddox 1mo ago
  It’s a silly question, since (short of a major life change or economic system change) you need the grocery store and the job to have decent quality of life. You need to trade your labor for money, and you need to trade your money for food. I would argue that there isn’t a huge difference in the fundamental nature of those two trades. Framing them in terms of “trade deficits” is pointing out which direction money is moving in each instance, but fundamentally they’re both just trades.
  - Gangway0829 1mo ago
    Indeed that is true, which is the point of both OP(or at least my takeaway). Attaching a moral value to trade deficits or surpluses, as the current administration seems to be in favor of doing, is fairly nonsensical.
- edgyquant 1mo ago
epolanski 1mo ago
Also, Trumps argument always ignores the bulk of US economy and exports: services. Somehow we count shoes and timber but not gazzilions in financial and cloud services.
bsimpson 1mo ago
Economically, it's a problem long-term. Dollars only have value if you can buy things with them. Japan, China, Saudi Arabia - countries we've had trade deficits with - have been buying our business, infrastructure, and real estate. Not defending tariffs, but there's a reason people care about trade deficits.
Refreeze5224 1mo ago
He doesn't have a view on trade deficits. To imply he does is giving him far too much credit. The "most powerful person on earth" in charge of the United States fundamentally doesn't understand trade deficits or tariffs. We do a disservice when we act like he has a strategy or view about these things. He doesn't. He is ignorant of how they work, and to prove it you only have to listen to his own words.

by kemayo 1mo ago

poncho_romero 1mo ago

It also excludes money spent on services, which in most cases favours the US.

kemayo 1mo ago
Look, my trade deficit with my barber is a real problem in our relationship. I need them to give me $20 for something, damnit.
giantrobot 1mo ago
> which in most cases favours the US Used to favor the US. Trump's policies and behaviors are ruining the US' reputation as a stable trading partner by demonstrating what damage can be done by an idiot with unchecked power. The rest of the world is going to permanently veer away from US services because it's not impossible (and sadly likely) another feckless imbecile will get put in charge.

inigyou 1mo ago

Actually you, like most of us, have a trade deficit with the grocery store and the movie theater, and a trade surplus with your employer. Which one is more enjoyable to have?

kemayo 1mo ago
The experience of the trade deficit with the grocery store and the movie theater is more enjoyable, overall. I get films and ice cream and a good time out of it. From my employer I get a lot of sitting in meetings -- they have to pay me to make me put up with that! My point is that reducing it entirely to "did I gain or receive cash-money from this?" isn't a particularly useful framing.
- jimkleiber 1mo ago
  I think it's what can happen when we shift more towards an exchange orientation and away from a communal orientation. Or in other words, as we see the world more win-lose and less win-win.
- inigyou 1mo ago
  Yeah that's the point. If you can get away with having a trade deficit not balanced by a surplus, that's a good thing because you get more movies and ice cream for less meetings. Trade deficits are good, people are just sending you free stuff.
tshaddox 1mo ago
It’s a silly question, since (short of a major life change or economic system change) you need the grocery store and the job to have decent quality of life. You need to trade your labor for money, and you need to trade your money for food. I would argue that there isn’t a huge difference in the fundamental nature of those two trades. Framing them in terms of “trade deficits” is pointing out which direction money is moving in each instance, but fundamentally they’re both just trades.
- Gangway0829 1mo ago
  Indeed that is true, which is the point of both OP(or at least my takeaway). Attaching a moral value to trade deficits or surpluses, as the current administration seems to be in favor of doing, is fairly nonsensical.
edgyquant 1mo ago

epolanski 1mo ago

Also, Trumps argument always ignores the bulk of US economy and exports: services. Somehow we count shoes and timber but not gazzilions in financial and cloud services.

bsimpson 1mo ago

Economically, it's a problem long-term. Dollars only have value if you can buy things with them. Japan, China, Saudi Arabia - countries we've had trade deficits with - have been buying our business, infrastructure, and real estate. Not defending tariffs, but there's a reason people care about trade deficits.

Refreeze5224 1mo ago

He doesn't have a view on trade deficits. To imply he does is giving him far too much credit. The "most powerful person on earth" in charge of the United States fundamentally doesn't understand trade deficits or tariffs. We do a disservice when we act like he has a strategy or view about these things. He doesn't. He is ignorant of how they work, and to prove it you only have to listen to his own words.