Trump's uphill trade battle with China

If Donald Trump succeeds in significantly reducing the U.S. trade deficit with China, he'll do so against the force of history — and of market expectations.

Why it matters: By placing the trade deficit with China at the top of the list of things he wants to slash, Trump is facing off against trillions of dollars' worth of deeply entrenched global trade patterns.

By the numbers: The trade deficit with China — our imports minus our exports — has been larger than $200 billion since 2005. It reached a record high of $418 billion in 2018, Trump's second year in office.

The big picture: The U.S. imports an astonishing array of goods from China, and it exports very little in the other direction.

• The tariffs imposed on China during the first Trump administration, which were then kept in place by President Biden, did relatively little to change that dynamic.

• During Trump's first term, when imports fell, exports fell too, blunting the effect on the trade deficit.

• That pattern would likely be repeated if he follows through on his pledge to impose a 60% tariff on goods from China: Our exports would end up being similarly taxed in retaliation.

The bottom line: For the time being, the market seems to be reasonably sanguine when it comes to the threat of a trade war.

• Maybe that's because no such thing has happened in the lifetimes of today's traders, and maybe it's because the sheer force of money flowing between China and the U.S. seems impossible to significantly disrupt, whatever Trump might dream.