President Donald Trump has referred to the trade deficit as a loss, as if we lose money by buying imports. But we don’t lose money when we trade to obtain goods produced by foreigners. This is like saying we lose when we have a trade deficit with the local grocery store. Every week I buy goods from the grocer, and he doesn’t buy any goods from me. But I gain because I get food to eat.

Free international trade raises our standard of living because it enables us to obtain less expensive goods and goods that cannot be produced in the U.S. Tariffs are taxes that raise the cost of bringing goods into the U.S. and thus make goods more expensive. They also protect inefficient domestic producers by restricting competition from foreigners. They, therefore, make it possible for these produce

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