What The US Quietly Controls—But Never Talks About
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From macro perspectives, since the announcement of Trump’s reciprocal tariffs in April 2025, discourse surrounding the trade war has largely focused on goods while virtually ignoring the trade in services. This oversight is crucial, as services have become central to global commerce, thanks to rapid technological advances and deregulation. Today’s services encompass everything from digital platforms to education and finance, and the United States, a service-based economy, enjoys a commanding position globally. Ironically, while U.S. rhetoric focuses on goods deficits, its true comparative advantage lies in high-margin, intangible exports
From micro perspectives, the United States holds a strong lead in global services trade, driven largely by its dominance in research-intensive industries—especially ICT sector. American tech firms like Meta, Apple, and
Microsoft generate relatively untaxed or underreported revenues from global users, reinforcing the U.S.’s hidden trade strength. Over the past decade, U.S. firms have outpaced international competitors in R&D investment. U.S. firms not only spend more on R&D but strategically
shape global innovation agendas, driving profitability and maintaining America’s central role in the digital and knowledge-based economy
Moreover, high R&D investments by U.S. firms strengthen their global dominance through network effects and economies of scale. As their user bases expand, platforms like Facebook and Google grow more valuable, lowering costs and increasing profits. Continuous innovation also
fosters lock-in effects, where consumers become dependent on these services, ensuring brand loyalty and consistent revenue. The micro-level competitiveness and innovation of these digital companies contribute to the
macro-level dominance of U.S. services trade. A blind spot in the chaos we have been too quick to ignore
