Did Donald Trump's Tariff Strategy Reduce the Trade Deficit?

In the context of increasing US trade fever, President Trump has asserted that the main issue stems from the lack of fairness in the trade relationship between the US and partner countries. He believes that while the US economy is very open, other countries keep their markets closed to US goods. Therefore, applying various taxes is seen as the only way to compel commercial enterprises to "reuse" this relationship. President Trump's Perspective Trump quoted the 'lack of response' status from trading partners as the US continues to record trade deficits with most countries. He emphasized: We have trade deficits with most countries - not all, but most - and we will change that. To address this issue, Trump began imposing tariffs on steel, aluminum, and goods from China. However, despite these efforts, data shows that the US chemical trade surplus still increased by 14% compared to last year, and after the tariffs were applied, the fire still burns. Formulating Arguments from Economic Experts Economic experts have put forward many viewpoints on whether the current use of tariffs is as effective as expected: Scott Lincicome (Cato Institute): Lincicome argues that as the USD is always preferred globally, its value naturally increases. A strong USD makes imports cheaper and exports more expensive, thus fueling trade tensions. He believes that trade wars symbolize a robust US economy, and Trump's tariff measures only serve to shift the trade balance between campaigns without solving the overall issue. Steven Kamin ( American Enterprise Institute ) Kamin believes that the loss of manufacturing jobs is not primarily due to competition from imports, but mainly the result of technological progress. He argues that while imposing tariffs may help attract some manufacturing jobs back, the number will be very limited and not enough to reverse the long-term trend. Ryan Young (Competing Businesses): Young emphasizes that commercial deficits do not reflect any negative economic conditions. American consumers buy goods from abroad because they value the high value received for the amount spent. He noted that, for over 50 years, the US has maintained trade imbalances while people's lives have continued to improve through indicators such as income, unemployment rate, life expectancy, and quality of life. Examples of Unfair Customs Tax Policies Some studies and data show that the commercial activities of the US tax policy are uneven, leading to trade imbalances: Case of Brazil: Although only 2.5% tax is levied on the consumption of ethanol in the U.S., Brazil imposes an 18% tax on imported ethanol from the U.S. As a result, by 2024, the U.S. had purchased ethanol from Brazil worth over 200 million dollars but only exported ethanol worth 52 million dollars to Brazil. The case of India: In the agricultural sector, the average MFN tariff applied by the US is 5%, while India applies an average of 39% for goods imported from the US. On the other hand, when it comes to major motorcycle companies, the US imposes a 100% tariff on imported bicycles, while Indian motorcycles are only taxed at 2.4%. The case of the European Union (EU): In the seafood industry, the EU allows the US to purchase seafood in large quantities but restricts the export of seafood from 48 out of 50 US states to the EU, even though the approval process has been improved since 2020. As a result, in 2023, the US imported $274 million worth of goods from the EU, but only exported $38 in return. Furthermore, for large cars, the EU imposes a 10% tax on cars imported from the US, while the US only applies 2.5% to cars from the EU. Conclusion Although President Trump asserts that tariffs will compel trading partners to 'use' and reduce trade imbalances, economic experts point out that trade UV rays do not necessarily signal a weak economy but can be a natural system of a strong USD and open economy. Legal measures on taxes may alter the balance among partners, but not necessarily result in overall improvements for trade battles or significant domestic production recovery. In the increasingly complex global trade context, finding a solution to the thorny issue of trade love requires a careful technical balance between short-term economic interests and long-term impacts on the economy. Trade policies need to be built on a deep understanding of economic mechanisms, rather than relying solely on measures such as imposing tariffs aimed at creating 'fairness' on paper.