Trump is attempting little less than a revolution in the global economy by reasserting American economic independence no matter the risks or pain. He sees trade deficits as inherently bad—and America’s deficit in goods traded with the world totaled $1.2 trillion last year.

When Americans buy foreign products, some of the dollars they spend cycle back home, as foreigners use the currency to acquire American companies (“foreign direct investment”) or invest in U.S. stocks, government debt and other securities (“foreign portfolio investment”). Trump wants Americans to buy American-made goods, however, which will keep more of the dollars in this country—they won’t go into foreign banks’ reserves, for example.

If Americans start buying from domestic manufacturers, the first thing their dollars will do is encourage more production at home, as manufacturers plow profits into building more factories and hiring more workers to raise output and meet the growing demand.

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