Mr. Trump has similarly assailed the United States trade deficit with China and other countries, often characterizing it as a scorecard, evidence
that China is winning at trade and the United States losing, to the tune of $310 billion a year.
If Mr. Trump can persuade China to loosen those restrictions, it might close the trade
deficit by increasing American exports — the healthy kind of trade rebalancing.
If the Trump administration really wants the trade deficit with China to come down over time, it’s not enough to look
at only one side of the international economic ledger — flows of goods — while ignoring the flow of capital.
For example, a trade war that significantly reduces American imports from China while also reducing American exports to China would reduce the trade deficit
but would mean lower incomes and fewer jobs in both countries.
That could be hard to turn around and be harsh on them in the economic realm.”
Mr. Trump likes to announce big splashy deals, and given
that the Chinese are looking for places to invest their capital in the United States, it would be easy enough to find something along those lines to announce.
The United States could conceivably have more negotiating leverage by threatening punitive tariffs or other aggressive measures, as Mr. Trump did during his campaign,
but those actions are just as likely to produce a painful blowback from China that damages the United States.
The U. S.-China trade imbalance is indeed driven in part by trade barriers
that China enacts against American companies, including a 25 percent tariff on imported automobiles and various quotas and restrictions that reduce agricultural imports.