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Wall Street, Hollywood may be antidote to huge trade deficit. Not Trump steel barriers

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The best way to reduce the U.S. trade deficit might be to open foreign markets to “service” industries such as retail, fashion and finance.

WASHINGTON (MarketWatch) — President Donald Trump has gone to bat “big league” for steel makers and other American manufacturers in a bid to slash the huge U.S. trade deficit, but the solution no longer depends on rescuing traditional blue-collar industries.

The best way to narrow the trade gap in the long run is more likely to come by opening up foreign markets to post-industrial companies such as Amazon












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Fidelity Investments and Paramount Pictures — firms that provide services instead of goods.

The U.S. has a large and increasing trade surplus in services, reflecting its leadership position in many of the most rapidly growing industries in the world.

Ensuring a level playing field in steel and other old-line businesses certainly can’t hurt, of course. A large slice of the $500 billion annual U.S. trade deficit arguably stems from unequal access to foreign markets.

In his first big move to address the problem, Trump on Thursday sought to revive an arcane 1960s law that could allow the U.S. to erect new barriers on foreign-steel imports. Read: Steel stocks rally on Trump review

The White House vows to protect American producers and their workers from what the president described as unfair competition that has cost countless jobs and made it harder for the economy to grow.

Yet the move to protect old-line industries, even if warranted and long overdue,…

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