The increase in customs duties in the United States could make Beijing the big winner of world exchanges-Liberation

Donald Trump has been obsessed since the 1980s by the issue of the United States trade deficit since the 1980s at the time with Japan, and has always seen customs duties as a solution. Yet economists on the right and left are unanimous on the total absence of economic reasoning underlying this vision. On the one hand, the trade deficit is not in itself a problem. For example, the United States imports more European goods than they export, so it is in trade deficit, but it is the opposite for services! The trade deficit can also be offset by financial flows. It is only between China and the United States that we can really talk about imbalances. In particular, the Chinese save too much, partly as a precaution to compensate for the weaknesses of the social protection system.

On the other hand, customs duties are in any case not a solution, a fortiori for the citizens of the country which puts them in place. They are inflationists since they add the price of imports. And they destroy employment since they make companies less competitive through the increase in inputs and therefore production costs. For example, in the case of steel customs duties, remember that there are fifty times more Americans who work in companies that use steel as a production factor than they work in factories that produce steel.