When it comes to trade with China, it often seems that U.S. President Donald Trump is his own worst enemy. Unilaterally raising tariffs, as Trump is threatening, is akin to punishing U.S. consumers for China's misbehavior.
Most economists view lower tariffs as a win for the U.S. economy, even if China doesn't reciprocate. Of course, they say, the world economy would be even stronger if tariffs were lowered across the board. There are a handful of economists, however, who disagree — and they can be split into two basic schools of thought, one of which might provide some hint of a method to Trump's madness.
Call the first the neo-mercantilist school. Neo-mercantilists, such as Trump adviser Peter Navarro, see the United State's trade deficit with China as inherently bad. Since imports subtract from GDP while exports add to it, Navarro argues, the U.S. economy would be stronger if it imported less and exported more.