Jagdish Rattanani is a journalist and R K Pattnaik is a former central banker. Both are faculty members at SPJIMR

The protectionist policy of Trump is based on the premise that a trade deficit is bad for the country and a trade surplus is good

We are on the edge of a full-fledged trade war. The US has raised tariffs, China is hitting back and businesses are watching anxiously as tensions rise and uncertainty grips the market. Amid this muscle-flexing comes a story from a place in Missouri, USA, called Butler County, where Trump won almost 80 per cent of the vote in the 2016 election. This is the case of the Mid Continent Nail Corporation, which makes nails used for home construction and improvement. The company speaks of "hard work, respect, optimism, a can-do attitude, and an indomitable spirit," calling up the values that have made it the largest makers of nails in the USA. Now, as Donald Trump's tariffs on steel begin to take effect, it is this company that is laying off workers and crying foul. Trump's new tariffs mean input costs have gone up and the sale of 'Made in USA' nails has fallen by half.