Trump’s trade war is based on a fake economic emergency, distorting facts to justify tariffs, gain power, and threaten U.S. stability.
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Trump’s trade war is based on a fake economic emergency, distorting facts to justify tariffs, gain power, and threaten U.S. stability.
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Donald Trump's bizarre decision to disrupt the economy and plunge global markets hinges on a massive lie. His strategy of imposing destructive tariffs on other countries rests on a skewed interpretation of a simple concept: the trade deficit.
He uses doomsday rhetoric to portray the trade deficit in negative terms. Based on this blatant mischaracterization — a Big Lie — he has declared a national emergency and started a trade war with the rest of the world (except for North Korea and Russia, which are exempt from his tariffs).
Let's break Trump's frames and see what he's really doing.
Contrary to Trump's deceptive rhetoric, the trade deficit signifies the United States' economic strength. A trade deficit occurs when imports exceed exports. This reflects the USA's appeal to global investors and is a sign of success, not failure.
As Tarek Alexander Hassan, a Boston University professor, explains in The Conversation:
A trade deficit sounds bad, but it is neither good nor bad.
It doesn’t mean the U.S. is losing money. It simply means foreigners are sending the U.S. more goods than the U.S. is sending them. America is getting more cheap goods, and in return it is giving foreigners financial assets: dollars issued by the Federal Reserve, bonds from the U.S. government and American corporations, and stocks in newly created firms.
That is, a trade deficit can only arise if foreigners invest more in the U.S. than Americans invest abroad. In other words, a country can only have a trade deficit if it also has an equally sized investment surplus. The U.S. is able to sustain a large trade deficit because so many foreigners are eager to invest here.
In simple terms: America runs a trade deficit because the world wants our financial assets. The U.S. dollar is a safe haven. Treasury bonds are stable. Our companies are engines of innovation. Until now, the U.S. has been the world's most attractive market.
The U.S. trade deficit exists because of sustained global demand for American assets. Investors worldwide want to buy U.S. dollars, bonds, and stocks — because they see the U.S. economy as strong, resilient, and innovative.
Yet Trump treats the issue like a scoreboard where America is "losing." He uses this myth to justify tariffs and call the deficit a "national emergency" — a claim that distorts basic economic facts. Tariffs won't fix the trade deficit. They will drive up prices for Americans, hurt our exporters, and threaten our leadership in the global economy.
The consequences are staggering: Trump's actions have already wiped $9.6 trillion from the stock market, delivering a massive blow to the economy and to the retirement savings of millions of Americans.
Imagine the headlines if a Democratic president had done that.
Of course, right-wing media outlets like Fox are busy spinning this collapse as a positive development. They're framing economic pain as patriotic duty — selling Americans the idea that suffering now means strength later. This isn't just dishonest; it's conditioning. Their role in shaping public opinion — and normalizing political lies — cannot be underestimated.
Most Americans rarely think about the trade deficit. That makes it a perfect target for distortion. But this isn't just about economics — it's about power.
Trump is inventing crises and then using them to justify sweeping actions. He's taken a manageable, misunderstood concept and turned it into a "national emergency" — not because it is one, but because the emergency frame gives him cover to act recklessly and consolidate power.
This tactic isn't new. Nazi legal theorist Carl Schmitt called it the state of exception — when an emergency, real or invented, is used to suspend norms and rewrite the rules. Authoritarians throughout history have used this exact concept to consolidate power. As Masha Gessen writes in Surviving Autocracy:
In Schmitt’s terms, a state of exception arises when an emergency, a singular event, shakes up the accepted order of things. This is when the sovereign steps forward and institutes new, extralegal rules. The emergency enables a quantum leap: Having amassed enough power to declare a state of exception, the sovereign then, by that declaration, acquires far greater, unchecked power. That is what makes the change irreversible, and the state of exception permanent.
We've already seen this play out. In January, Trump declared a fictional border crisis and used it to justify vicious actions against immigrants. The pattern is clear: create a fake emergency to justify extreme policies.
The economic chaos Trump is triggering now follows the same playbook — and the consequences will ripple far beyond markets and manufacturing.
There's a tendency to get bogged down debating the technical details of trade. But the real threat isn't the deficit — it's the authoritarian logic driving its weaponization.
Trump is using a lie to create a crisis. Then, he's using the crisis to expand his power. We can't normalize "emergencies" manufactured for political gain. Doing so would risk the foundation of democracy itself.
We can't afford to fight these battles one emergency at a time. We must expose the playbook, reject the lie, and refuse to let fear become the foundation of law.
Last week, I joined writer Wajahat Ali for a conversation about why Trump, Elon Musk and his fellow broligarchs seem hellbent on crashing the U.S. economy. Click below to watch our conversation, which is based on my work at The Nerd Reich newsletter.
I've tried to keep my work on tech fascism separate from my work on FrameLab. But that has become increasingly hard to do, since the tech broligarchs have essentially taken over the U.S. government.
Let me know if you have any questions!
Millions of people nationwide stepped out of their homes and into the streets this weekend. They didn’t do it for show. They did it because something in them said: Enough.
From New York to Nashville, Oakland to Omaha, a powerful wave of people united to defend our democracy, freedom, and future. Over 1,300 Hands Off protests took place on April 5.
Those in power want us to be afraid. They want us isolated, overwhelmed, convinced we can do nothing. But when people stand up publicly — in huge numbers — it cracks that illusion wide open.
Gil Duran
Why Trump Fears Protest Power
That kind of courage does more than make a statement. It changes what everyone around us thinks is possible. It reminds us that fear doesn’t have the final word.
Courage isn’t something you’re born with. It’s something you build by doing the hard thing again and again. And that’s what this weekend was: a country-wide practice in refusing to back down.
If you were out there — marching, shouting, standing shoulder-to-shoulder with strangers turned allies — thank you! Keep going. If you weren’t, that’s okay. This movement is just getting started, and there’s still time to step in.
The frame — and the future — is still ours to shape.
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