When the Germans run a $63 billion trade surplus with the United States, as they did last year, that means they have $63 billion on their hands. What can they do with that money? They can sit on it, as the Chinese and many other people around the world do, preferring to keep their savings in strong and steady dollars rather than in yuan, euros, or pesos. They can use it to buy dollar-denominated assets such as shares in Apple or Ford. Or they can invest it directly in the United States, as the Germans have with their automobile factories in the United States.

Far from being victimized by such trade, Americans are enriched by it. We get $118 billion in German-made goods in exchange for $54 billion in U.S.-made goods, which leaves $64 billion over to invest in American assets. Do you know who the largest U.S. automobile exporter is? It is BMW Manufacturing, which builds SUVs in Spartanburg, S.C., where it employs more than 9,000 people. Our trade deficit with Germany made that possible — that’s where the money to build the factory came from. Ask the autoworkers in South Carolina whether they think that’s a good tradeoff.