Transcription
What is also clear is that Trump has no economic theory behind what he's doing. And I think that's most disturbing, both to me as an economist and to those who are on the other side of negotiations. I've talked to some of these people, and they say, "You know, we don't know how to negotiate because the other side is not a normal, a normal negotiator." You know, normally the other side knows what they want; uh, there's a theory about how trade works. Uh, that's not true here; it's a different world. So let me give you an example.
Um, Trump thinks that trade deficits by themselves, and in particular trade deficits in goods, reflect somebody treating us unfairly. And it's based sort of on a premise that we are better than any other country, so people should be buying more goods from us than we are buying from them. But we are in the 21st century, not where we were in 1950. Services are the major part of our economy; goods production, manufacturing, is 9, 10%. What are important service sectors? Tourism, education, health. What is he doing to those sectors? Look what he's done in the last few weeks: he's devastated our education system. The way his immigration people have treated those wanting to come into our country with valid passports and visas has discouraged tourism. So he is hellbent on hurting America's major export industry: tourism and education.
I've talked to firms that have thought about bringing manufacturing back to the United States. They say, "We don't have the logistics; we don't have the supply, uh, uh, chains that you need to bring complex manufacturing back." And modern manufacturing is robotic, so even if we brought manufacturing back, there aren't going to be many jobs. So the reality is that his picture of bringing us back to the 1950s—that's never, never going to happen. But what's going to happen in the meanwhile?