United States Trade Representative (USTR) Jamieson Greer is scheduled to testify before the U.S. Senate Committee on Finance and the U.S. House of Representatives Committee on Ways and Means this week.
Finance and Ways and Means Members should ask the following question:
“Your basis for imposing tariffs is that large and persistent annual U.S. goods trade deficits constitute an unusual and extraordinary threat to the national security and economy of the United States. The United States has run trade deficits for 48 straight years, during which time the U.S. economy has grown by 255% in real terms. Decades of trade deficits have corresponded with increases in manufacturing output, wealth, and household incomes. In the United States, GDP per capita has increased more than in our top trading partners like Canada, China, the European Union, Japan, Korea, and Mexico, even though we tend to run trade deficits with them. Why do you consider the rapid increase in the wealth of Americans to represent a national emergency?”
U.S. trade deficits are driven by macroeconomic factors, including the desire of our trading partners to invest in the United States. That’s one reason nearly two-thirds of U.S. economists do not think a large balance of trade deficit has an adverse effect on the economy. It is tariffs, not trade deficits, that constitute an unusual and extraordinary threat to the U.S. economy.