“Reducing the trade deficit must necessarily include reducing our budget deficit as well.”
Yes. If we buy less Chinese stuff, then China has less dollars to buy Gov bonds, which means Gov has less money and has to spends less and decrease in size.
Meanwhile US production takes up some of the slack, more jobs, more wealth here.
Bring on the tariffs!
If we buy less Chinese stuff, then China has less dollars to buy Gov bonds, which means Gov has less money and has to spends less and decrease in size.
Umm...not exactly.
Foreign purchases of Treasuries by China, or lack of purchases, has NO effect on what Uncle Sam spends. Take a look at the publicly available numbers and be convinced.
This is an issue no one wants to grapple with - reigning in deficit spending!
Tariffs are all well and good. But until most of those products are manufactured and distributed here in the USA, massive government deficits (at all levels) will be a major contributor to the trade deficits.