For decades, the foundation of America’s economic and geopolitical strength has been its ability to export intangible assets like ideas, technologies, and expertise. But now, President Donald Trump’s trade policies risk unraveling the very system that has underpinned a century of American prosperity.
CAMBRIDGE – There were no witches in Salem, Massachusetts, in 1692-93, yet dozens of people were executed based on a false understanding of the world. Today, a similar misconception is shaping US economic policy: President Donald Trump’s “reciprocal” tariffs reflect the mistaken belief that the United States suffers from large trade deficits, and these reflect economic decline and foreign exploitation. Fueled by bad accounting, this narrative now threatens to undermine both American prosperity and the international order that sustains it.
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