Swammerdami
Squadron Leader
Yes, WHY are RV and DJT(?) so focused on "heavy manufacturing"? There are a variety of other U.S. exports that help balance the trading deficit. For example
- Foreigners who arrive to study at U.S. Universities bring dollars for tuition and other expenses. But Trump's policies (anti-education, anti-DEI, anti-free speech) are causing such "education tourism" to plummet.
- The U.S. has been a major tourism destination. Foreigners want to see the Grand Canyon, Disneyland, Manhattan, Las Vegas, Yellowstone, Niagara Falls etc. Trump's policies are causing tourism to plummet: Foreigners (and even U.S. citizens) are in fear of ICE. My sister -- a U.S. citizen -- will no longer travel abroad. She hears of citizens upon return being forced to unlock phones so their social media posts can be checked for anti-fascist content.
- Movies, TV content, software, financial services are examples of services exported rather than material goods. The U.S. runs a big trade SURPLUS on services compared against goods. But it's easier to switch services compared with goods. China has announced a boycott of U.S. movies; expect more countries to follow. RV's hero ranted that he would increase "respect" for America. The truth is the opposite.
- Even after the recent plunge the S&P500 P/E is 23½, with NASDAQ even higher. U.S. Assets, e.g. bonds and high-priced stocks have provided a parking spot for foreign-owned dollars. For almost a century U.S. assets have outperformed foreign assets. But Trump's policies will weaken U.S. assets, weaken the dollar, and speed the rush away from the dollar as premier reserve currency. It remains to be seen to what extent lost U.S. strength will pass to democracies like France, Germany and Canada, or pass to totalitarian states.