Stephen Miran, nominee for chairman of the White House Council of Economic Advisers, is sworn in to his Senate Banking, Housing and Urban Affairs Committee confirmation hearing in the Dirksen Senate Office Building on February 27, 2025. (Photo: CFP)
Stephen Miran, chair of the White House Council of Economic Advisers, recently presented a sweeping, unapologetically America-first blueprint for reshaping global trade—one that could shift the burden of Washington's fiscal deficit squarely onto its trading partners—at an event hosted by the Hudson Institute.
Speaking on April 7, Miran argued that America's trade deficit has steadily eroded domestic industry, attributing this decline to what he described as "free-riding" by other nations. In response, he advocated for tariffs, not only as a means to protect U.S. manufacturing but also to help offset the federal deficit.
In a striking moment, he even suggested that other countries could directly transfer funds to the U.S. Treasury—an idea critics label as an example of the "bandit logic" underlying the Trump administration's economic thinking.
A new economic doctrine
Miran's ideas are outlined in a 41-page essay titled A User's Guide to Restructuring the Global Trading System, published in November 2024 shortly after Donald Trump's electoral victory. Some analysts now view it as the intellectual foundation of Trump's revived trade agenda.
According to Miran, the overvaluation of the dollar is central to America's economic malaise. He argues that a strong dollar makes U.S. exports less competitive, cheapens imports, and discourages investment in domestic manufacturing.
The dollar's status as a global safe-haven currency has long made U.S. debt attractive to foreign investors, allowing America to borrow with few constraints. However, Miran contends that this privilege now imposes unacceptable costs domestically.
To address this issue, he proposes a new global pact modeled on the 1985 Plaza Accord, which orchestrated a controlled weakening of the dollar among major powers. His version is dubbed the "Mar-a-Lago Accord," named after Trump's Florida estate.
Miran suggests that punitive tariffs could be used to pressure trading partners like China and the EU into accepting a currency deal—exchanging tariff relief for a coordinated devaluation of the dollar. "President Trump views tariffs as generating negotiating leverage for making deals," he wrote.
He also presents a series of controversial financial proposals: urging U.S. partners to sell their dollar reserves to help weaken the currency; advocating for the conversion of short-term Treasury bonds into 100-year debt to avoid regular repayment; and even suggesting a "user fee" on foreign official holders of U.S. debt to replenish government coffers.
Countries that comply, he argues, could benefit from lower tariffs and ongoing access to U.S. military protection.
Miran cites the 2018-2019 tariff war with China as evidence that such pressure can be effective. Despite higher tariffs, U.S. inflation remained relatively stable, the dollar strengthened, and the yuan depreciated—a "currency offset effect" that he claims shifted the financial burden onto China.
However, replicating that outcome may prove challenging. In recent years, countries have begun to push back against dollar dominance. Russia now holds renminbi reserves, and the EU is exploring ways to enhance the euro's global role. De-dollarization is no longer a fringe idea—it has become policy.
The limits of tariff power
Even Miran acknowledges that tariffs alone won't revive American manufacturing. Years of offshoring have depleted capacity. Building a factory takes significant time, skilled labor is scarce, and American wages are substantially higher than those in emerging economies. Currently, manufacturing employs just eight percent of the U.S. workforce.
Meanwhile, tariffs impose immediate costs. Prices rise, political frustration escalates, and inflation remains a significant threat. Higher input costs can ripple across industries, reducing the competitiveness of U.S. producers.
"Take aluminum and steel, for example. The U.S. is the largest importer of these materials. Domestic production cannot meet demand, with capacity utilization already exceeding 90 percent. Higher tariffs on these materials will result in increased costs for consumers on everything from soda cans to cars," said Einar Tangen, senior fellow at the Taihe Institute, in a recent interview with GDToday in Beijing.
Retaliatory tariffs from major trading partners like China and the EU further undermine exporter confidence and broader economic stability.
Miran's vision relies on a sustained global willingness to adhere to Washington's rules. However, that world is changing. Trust in U.S. leadership is waning, and faith in the dollar is no longer guaranteed. As a result, Miran's blueprint may end up serving as a cautionary tale of what not to do.
Co-presented by GDToday and the School of Journalism and Communication, Jinan University
Reporter | Liu Xiaodi, Peng Shengjie (intern)
Editor | Yuan Zixiang, James, Shen He
