Hacker News Reader

Comment by tdb7893 | Hacker News Reader

Subsidizing specific manufacturing and having at least some consistency was a big part of the US strategy until the last few months. Most notably, the US passed huge subsidies for semiconductor manufacturing in 2022.

I don't know how effective that will be but it at least seems more coherent than these goofy tariffs (whatever people think of tariffs overall we absolutely cannot keep shifting them week to week).

View on HN

> we absolutely cannot keep shifting them week to week

We absolutely cannot create the expectation that we plan to get what we say we want: zero trade deficits.

If we even succeed in making the rest of the world believe we're going to do this it will be catastrophic. So much of the advantages the US enjoys rides on trust and goodwill, and zeroing trade deficits would wreck the world economy and destroy trust in the US dollar as a safe haven. Just like paying down the national debt would.

Zeroing trade deficits means by definition that the rest of the world won't have (many) US dollars.

(Pedantically: it means the rest of the world has exactly as much US currency as the US has the rest of the world's currency)

No, it could also mean that US have many foreign currencies stockpiled.

The trade deficit is a measure of the flow of currency, not the stores.

It was insanely effective: https://fred.stlouisfed.org/series/PRMFGCON. Notice the sharp dip at the end there.

Reply on news.ycombinator.com