Peter Navarro Is Not the Way

By Dominic Pino

Monday, April 14, 2025

 

Navarro got his Ph.D. in economics from Harvard, but we won’t hold that against him. He was a professor at the University of California, Irvine, for about 30 years. Earlier in his career, he wasn’t the cartoonish protectionist he is today, as Pierre Lemieux wrote for the Cato Institute in 2018. In fact, a paper by Navarro about the economics of electricity was published in 1983 in Regulation, then a publication of AEI that was later acquired by Cato. The Policy Game, Navarro’s book published in 1984, makes standard points about the dangers of tariffs from economic history and warns, “The biggest losers in the protectionist game are consumers.”

 

Lemieux traces the revolution in Navarro’s thinking to his 2007 book The Coming China Wars. Perhaps Navarro adjusted his views based on years of experience, but those adjustments were in a left-wing direction. The Coming China Wars made the mid-2000s Democratic case against China, namely that it was too free market and its integration into the global economy was to please rich capitalists in the West at the expense of workers. “He lauds China’s 2006 Five-Year Plan, which was supposed to end that country’s ‘Adam Smith on steroids’ attempt at market liberalization and replace it with government-managed ‘sustainable growth,’” Lemieux wrote.

 

Navarro’s political views are all over the map. He ran for Congress as a Democrat in 1996, with campaign material branding him “The Democrat Newt Gingrich fears most!” He addressed the Democratic National Convention that year. His speech wasn’t about trade at all, and even though Bill Clinton had signed NAFTA, he said he was a proud Clinton supporter. He spoke about the need for greater environmental regulations, decried Republicans’ efforts to cut student loans, and concluded, “Together with President Clinton, we will protect Medicare, and Social Security, and a woman’s right to choose.”

 

In his 1998 memoir, Navarro wrote that “insufferably bigoted, close-minded, and dangerously well-disciplined storm troopers on the religious right wield far too much influence at the ballot box.” He praised Nancy Pelosi as “street-smart, savvy” and Hillary Clinton as “gracious, intelligent, perceptive, and, yes, classy.”

 

It wasn’t just the run for Congress. Navarro ran for mayor of San Diego in 1992, San Diego City Council in 1993, San Diego County Board of Supervisors in 1994, and San Diego City Council again in 2001. He ran as a Democrat every time and lost every race. Larry Remer, a Democratic consultant who helped run Navarro’s campaigns, told Time in 2018, “He was right about a lot of things. But he was just an a-hole.”

 

During the first Trump administration, Navarro was appropriately concerned early on about the potential for Covid-19 to become, in his words, “a full-blown pandemic,” and he relayed these concerns in internal documents as early as January 2020. Publicly, though, in February 2020, he said the virus was “nothing to worry about for the American people.” Somehow, from his position as director of the Office of Trade and Manufacturing Policy, Navarro became a leading voice promoting hydroxychloroquine as a treatment for Covid.

 

After Trump lost in 2020, Navarro went all in on election denial theories. He was on the phone call that attempted to convince Georgia election officials to overturn that state’s election results, and he worked to coordinate efforts by Republican state legislators nationwide to send “alternative” electors and have Vice President Mike Pence reject votes for Biden. Navarro isn’t ashamed of his behavior; in fact, he wrote a book explaining that he did these things. After refusing to comply with a congressional subpoena, he was convicted of contempt of Congress and served four months in jail in 2024.

 

Perhaps crazier than all of this, though, is one of Navarro’s frequently quoted sources in his published work. “Ron Vara” is the name of an anti-China economist who is quoted more than a dozen times across five of Navarro’s books. He’s a fellow Harvard grad who served as a reservist during the Gulf War. The thing is, he doesn’t exist. “Ron Vara” is an anagram of “Navarro.” After a researcher noticed the anomaly in 2019, Navarro admitted to having invented him.

 

He’s Wrong on Economics, Too

 

Navarro needs to make up economists who agree with him because his economic views are incorrect. As Ryan Bourne wrote for CapX in 2017, Navarro holds at least four beliefs on trade economics that are simply wrong: imports reduce GDP, goods exports are inherently better than services exports, bilateral trade deficits are always problems, and higher trade deficits are associated with lower investment. These errors range from treating accounting identities as economic value statements to sentimentalism for the good old days that never existed.

 

Navarro is one of the folks who thinks China’s joining the World Trade Organization was a uniquely destabilizing and damaging event in U.S. economic history. He expounded this view in a feature-length film narrated by Martin Sheen in 2012, Death by China, which posits that a flood of cheap imports from China when U.S. trade barriers were removed has destroyed U.S. manufacturing. As Daniel Griswold wrote in a 2017 review of the film, this simply is not true:

 

Under the accession agreement, no U.S. duties were actually lowered, since we had been granting China conditional NTR [normal trading relations] since the 1980s. What did change was China’s trade regime, which, according to a 2015 report from the U.S. Trade Representative, has reduced China’s average tariff rate on goods of greatest interest to U.S. industry from 25 percent before accession to 7 percent.

 

In other words, China’s WTO accession actually did what Trump claims to want: It got China to lower its trade barriers without forcing the U.S. to do so in exchange. But Navarro treats this event as one of the original sins of U.S. trade policy.

 

Navarro believes that trade barriers are the primary cause of trade deficits. A country’s trade deficit with the rest of the world is actually caused by an imbalance between savings and investment. In the case of the U.S., investment is higher than savings, so the difference is made up by international trade. The flip side of every trade deficit is an investment surplus.

 

As Timothy Taylor wrote last week, “The overall argument that the US has larger trade deficits than a half-century ago is because trade barriers around the world are higher than a half-century ago doesn’t pass a basic reality check.” NAFTA, that supposed villain, reduced trade barriers. The U.S. has a trade deficit with some of the countries it already has free trade agreements with, and trade surpluses with many countries it does not. And again, China’s reduction in its trade barriers when it joined the WTO coincided with an increase in the U.S. trade deficit.

 

As to the supposed importance of trade negotiations in the administration, Navarro has repeatedly made clear in his words and actions that he does not take such negotiations seriously. “Let me make this very clear. This is not a negotiation. This is a national emergency,” Navarro said earlier this month. In February, The Telegraph reported that he suggested the U.S.–Canada border be redrawn as part of trade negotiations, helping to scuttle any discussions that were taking place between the two countries. He also said in a Fox News interview, “Canada has been taken over by Mexican cartels.”

 

The language of Trump’s “liberation day” executive order reflects Navarro’s views on trade. It refers to trade deficits as a cause for the national emergency declaration that undergirds the “reciprocal” tariff plan, which is not based on tariffs but only on a country’s trade balance with the U.S. The strange views of this strange man who could never win an election on his own are now an integral part of U.S. trade policy because the president of the United States happens to agree with him.