Free Trade

The Trump Administration Wants More Tariffs To Combat 'Structural Excess Capacity.' Here's What That Means.

When businesses in other countries produce more goods than their domestic markets can use, is that a conspiracy against America? Of course not.

Eric Boehm | 6.16.2026 2:30 PM

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Every year, there are many more airplanes manufactured in the United States than the country's domestic airlines can use.

This is a rather straightforward fact, but it has some important ramifications for the Trump administration's trade policies, so bear with me for a moment. During 2025, for example, Boeing churned out 600 commercial airliners from its assembly facilities in Washington state and South Carolina. Many of those planes were sold to foreign airlines and exported.

Last year was no outlier: The U.S. routinely exports billions of dollars worth of commercial aircraft and airplane equipment. We make more than we can consume, and we sell the rest to businesses in other countries. This excess manufacturing is not a problem. On the contrary, this is tremendous news for the workers at Boeing and for the company's shareholders. It's also great for those foreign buyers—airlines can purchase Boeing planes without first needing to develop a local airliner-production industry.

On the other hand, if America were limited to producing only as many airplanes as it could consume domestically, Boeing's workers would have less to do, make fewer sales, and probably earn lower pay. Boeing's shareholders and those foreign airlines would be worse off too. Everyone involved would be poorer.

But the same excess manufacturing........

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