‘America first’ showcases Trump’s currency confusion
Policy woes are made in the US, not abroad
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US PRESIDENT Donald Trump has again demonstrated his confusion on currency issues with his “America first” executive order on trade policy.
Section 2a of the order shows this clearly: “The secretary of commerce, in consultation with the secretary of the Treasury and the United States Trade Representative (USTR), shall investigate the causes of our country’s large and persistent annual trade deficits in goods, as well as the economic and national security implications and risks resulting from such deficits, and recommend appropriate measures, such as a global supplemental tariff or other policies, to remedy such deficits.”
The US current account deficit is predominantly a macroeconomic phenomenon, reflecting the country’s savings and investment gap. America’s huge and unwise fiscal deficits, which Trump’s plans threaten to exacerbate, will add to that gap.
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