For context, Lassman shares Section 4.6: Trade⁷ with Peter Navarro, who disagrees with him almost across the board. Peter Navarro DID serve in the Trump administration, and spent four months in prison in 2024 for contempt of Congress. Navarro is a proponent of “decoupling” from China. More about what the results of decoupling from China would be here.¹

“In contrast to Lassman, Navarro thinks that “trade deficits matter a great deal.”” (Project 2025, Section 4: The Economy, page 690 paragraph 4.) 

Trump is famously obsessed with trade deficits, and, like tariffs, doesn’t understand what they are or how they work:

I wrote an informal commentary about this tweet in May 2019:

Trump doesn’t appear to understand that “trade deficits” aren’t actually deficits. We don’t owe money. We aren’t losing money. It means that we are consumers, which is a sign of economic strength. The literal definition of a trade deficit is, the amount by which a country’s imports exceeds the amount of its exports. We have a $500B trade deficit with China because we bought $500B more in goods from them than they bought from us. This seems simple enough to understand.

Unfortunately, Trump is such a simpleton that he thinks that every transaction has a clear winner and a clear loser, and the winner is always the one who walks away with more money. All of his personal deals are scams, so he thinks that all deals are scams, and that paying money is a sign of weakness. He wants you to think he’s looking out for the American people, but all he’s doing is making it more expensive for American businesses to operate and more expensive for American consumers to buy things. Farmers will be hit hard in particular. We got something for the money we spent. The goods we bought from China created opportunity and fueled industry here.

Trading doesn’t equal losing money, and more tariffs aren’t the answer – that’s only going to punish ourselves. China will just jack up the prices on the things they sell us to pay for anything punitive we try to do in that direction. And why shouldn’t they? Also, traditional tariffs are paid for by the importer, so we’d be screwing ourselves there, too. The tariffs on Chinese imports would be paid to the U.S. Government by the U.S. companies doing the importing, who will then pass their cost increases on to the consumer. Not by China.

Or, if you’re a fan of analogy, we got stuff for the money we “gave” China. We purchased goods for our $500 billion dollars. You don’t go shopping, buy a bunch of stuff, then complain that you “lost” your money. When you go to the grocery store and buy $100 worth of goods, the grocery store doesn’t come to your house and give you $100 for a lamp. You spend money on their stuff, they don’t spend money on your stuff. That’s all a “trade deficit” is. It’s not “unfair”, because you got the stuff you paid for.

It’s debatable whether China is “playing fairly” with us with regard to trade. My issue is not with Trump taking a stand. My issue is that he clearly has no idea how any of this works, and no clear strategy other than bluster.

More about tariffs and how they work here.²