April 4 | By: Wilbur Ross.
The US has the lowest trade barriers and the largest trade deficit in the world — $500bn annually.
This is why President Donald Trump has directed the US Department of Commerce to report back within 90 days with a comprehensive analysis of the economic realities and the fine details of America’s trade patterns.
Once Mr Trump has that analysis, he will be able to take measured and rational action to correct any anomalies.
This analysis will involve finding answers to a number of critical questions.
Do artificial non-tariff trade barriers cause these deficits? Lower tariffs mean nothing if imports are still effectively blocked. We must establish which bilateral deficits are caused by dumping or other cheating. Serial trade offenders undermine the entire system.
How serious are the problems of intellectual property theft and forced technology transfers? As the world becomes more and more technology-driven, intellectual resources will determine economic outcomes.
Which bilateral trade deficits are structural rather than mercantilist-driven? For example, the US is not self-sufficient in oil and therefore must import millions of barrels a day.
To what extent do non-market economies operating within a market based system create trade imbalances? If state-owned enterprises do not behave like normal businesses, they unduly tilt the playing field.
Read the article here.