Global trade imbalances have persisted for some time. Before the 2008 global financial crisis they were such a problem that in June 2006 the International Monetary Fund hosted the first “multilateral consultation on global imbalances”. The aim was an orderly unwinding of imbalances in a manner supportive of global growth. Large deficit countries such as the US and UK were encouraged to save more. Such adjustments to currencies, spending and savings are still valid ways to address imbalances but there is little justification for the approach taken by the US on tariffs.
