A 1906 aerial watercolor portrait of Harvard University – Public Domain
Donald Trump seems to have even more trouble staying focused these days than usual. People may recall back to April 2 — which Trump declared as “Liberation Day” — when he imposed massive tariffs that were supposedly going to keep other countries from ripping us off. To Trump, ripping us off meant that they were running trade surpluses with us.
As many have pointed out, this is a rather odd notion of getting ripped off. If a country sells us more than we sell to them, it seems like we’re getting a good deal. It’s sort of like if we go to a grocery store and buy things we like, at prices we consider fair. They sold us more than they bought from us, unless we happen to be farmers, but we usually wouldn’t say we have been ripped off.
But anyhow, that was the Trump story a month and a half ago. He considered getting our trade deficit down, or even eliminating it altogether, to be a matter of the utmost urgency.
But that’s apparently ancient history now. Trump seems intent on wrecking our university system, which is a major source of export earnings. Earlier he had cut off billions of dollars of grants that had been awarded to Harvard by the National Institutes of Health and other government agencies. He also threatened to take away their tax-exempt status, which would likely lead to a major reduction in contributions.
In his latest move, Kristi Noem, the Secretary of the Department of Homeland Security, announced that she would not grant visas to any international students attending Harvard. This applies both to prospective students and also students already enrolled in degree programs.
This would be a huge blow to Harvard. It both gets considerable tuition money from foreign students, but also enrolls some prized graduate students. Because of its reputation, Harvard attracts many top students from all over the world. Noem’s action would end this.
People can think whatever they want about Harvard, but this is an attack on the American university system in general. If the administration can cancel someone’s ability to study here, any time it wants, for any reason whatsoever, then few students from other countries will opt to attend colleges or universities in the United States.
And universities are actually a major source of export earnings for the United States. Last year, we got over $56 billion from tuition and other expenses paid by foreigners to US colleges and universities. This number is likely to fall sharply next year.
In fact, foreign tourism more generally is a very large source of exports earnings for the United States. This category generated $215.3 billion in revenue in 2024. That compares to $165 billion for agricultural products, $171.6 billion for cars and parts, $125 billion for aircraft and $97 billion for steel and other metals. If we care about reducing our trade deficit, it would seem that attracting foreign students to our universities and foreign travelers to visit the country, should be a big part of the picture.
Harvard will likely challenge Noem’s action in court, as it has done with earlier efforts by the Trump administration to punish it. However, whatever the courts ultimately rule, we are likely to pay a price due to fewer students coming here, as well as tourists and other travelers.
There are many places in the world that people living outside the United States can go to study or for vacations. It’s a safe bet that most of them would rather go to a country where politicians can’t have them detained and/or deported based on any whim that goes through their head. If the Trump administration really cares about the trade deficit, they should be thinking about this fact in their dealings with Harvard and other universities.
This first appeared on Dean Baker’s Beat the Press blog.
