Trump Tariffs Work: Trade Deficit Plummets to Five-Year Low
Impact Score: 2.2
Timeline: N/A: No specific implementation deadlines, report focuses on economic performance outcomes.
Summary: The U.S. trade deficit has decreased by over 35% year-over-year to its smallest level since mid-2020, driven by a 6% rise in exports and reduced imports. Tariff revenues have surged, halving November’s trade deficit compared to last year. The America First trade agenda under President Trump improved deals with major global economies, boosted onshoring investments, and created tens of thousands of jobs, contributing approximately 1% to real GDP growth in Q3 2025. However, these policies pose risks of heightened trade tensions, potential retaliations, and effects on international collaboration, student enrollment, and funding.
Key Actions: Vanderbilt’s Owen Graduate School of Management should research trade policy impacts on markets; the Office of Federal Relations should engage with policymakers on evolving trade deals; Law School can develop international trade law expertise; and the Economics Department should study economic impacts to inform partners and policymakers. Opportunities exist to enhance research on trade policy effects, expand international studies curricula, and build partnerships with domestic industries reshoring operations.
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