Navarro and Trade

Peter Navarro, a senior trade advisor, received $1 million from Nucor Corp., a steel manufacturer, to produce a 2012 documentary film, Death by China, against imports in general and from China in particular. A book with the same title was published in 2011, co-authored with journalist Greg Autry. This is a quote from it:

"And the argument is pretty simple. The gross domestic product grows with only four things: consumption, investment, government spending, and net exports. And when you run a trade deficit, the simple math of that is that that's a negative in terms of growth."

But that is not true. If Toyota invests one million dollars in property in Kentucky, is that a negative for the GDP? No. GDP is not equal to the sum of consumption, investment, government expenditures, and net exports (exports minus imports). It is instead the sum of consumption, investment, government expenditures, and exports (not net exports). GDP is the acronym of gross domestic product, and only expenditures on domestic production are included.

The reason national statisticians of the Bureau of Economic Analysis (BEA) subtract imports is that they are already included in the positive side of the ledger, in consumption, investment, and government expenditures. The value of GDP they thus calculate does not include imports in any way--and specifically not as a subtraction--because GDP cannot include them by definition. For example, personal consumption expenditures ( PCE) includes expenditures on imported cars as well on domestically produced cars; thus, in order to properly measure domestic production, the sales of foreign-produced cars that are included in PCE are offset by a comparable entry in the imports of these cars.

Navarro is a PhD in economics, has taught economics at Irvine and is a senior--senior--advisor to Trump. How could he be saying this? And how are we to be so vulnerable to the whimsical musings of these people?