Analyst stunned how far trade deficit has been cut by Trump administration

Trump is famous for his stance on immigration as well as using tariffs to force countries into better trade deals with the United States.

This time around, Trump went nuclear, and he was mocked in the media, by Dems, and even some Republicans pushed back against the idea of lowering our trade deficit with tariffs. But it would now appear that Trump is getting the last laugh.

Trump Doubles Down

Trump is using tariffs for two distinct purposes: to revive American manufacturing and to reduce the United States' trade deficit.

Now, there are many different theories on whether the trade deficit is a good thing or a bad thing, but the one reality of it is that American manufacturing is way down, and we import more goods simply because this country has moved away from making them.

To that point, American steel is in a very bad place right now, something that Trump was hoping to rectify by imposing bigger tariffs on foreign steel.

While appearing in Pennsylvania, which is the steel capital of the country, Trump announced raising tariffs to 50%, stating, “At 25%, they can sort of get over that fence. At 50%, they can no longer get over the fence. Pittsburgh will very soon be respected around the world as the Steel City again.”

Prices Will Soar

When Trump imposed his worldwide tariff plan, Democrat leaders like Rep. Hakeem Jeffries (D-N.Y.) told the American people that it would result in rising costs of goods and it would crash our economy.

They even went so far as to take out ads, one of which stated, “There’s one person who thinks everything in your life should cost more … It’s your Congressman … He backed the tariffs causing prices to soar.”

EJ Antoni, chief economist at the Heritage Foundation, responded to the attack ads, stating, “President Trump was handed worsening inflation, and he brought it back down in just a few months. The claim that prices are soaring is empirically false by any measure.”

To back up his claim, we need only look at the personal consumption expenditures (PCE) price index, which was at 2.1%, an increase of only 0.1%, the lowest it has been since Biden’s first full month in office.

Can’t Believe My Eyes

CNBC’s Rick Santelli was in disbelief at how far the trade deficit has come down in only a few months under Trump.

In March, just two months after Trump took office, the trade deficit was sitting at $140.5 billion, and Trump laid out his plan in April.

The new numbers have come in, and Santelli was stunned, stating, “Last number, of course a very important number to this administration, this is the trade balance, which is a deficit, expecting -$143 billion. Wow! It comes in much, much smaller, minus-87 billion and now this follows, this follows, a 163 that gets converted to 162 billion with a minus sign, the worst since record-keeping 1989, then we cut it in half to 87.6?”

That was the lowest number on this front in nearly two years, so Trump’s plan is clearly working strictly in terms of reducing the trade deficit. Now, if we can get American manufacturing fired back up, the jobs market will take care of itself.