The Trump administration has implemented tariffs with the stated aim of reducing trade (or current-account) deficits. The thought experiment of imagining prohibitive tariffs on all imports tells us that a high enough tariff would surely reduce these deficits. On the other hand, many analysts argue that these deficits are determined by macroeconomic policies that affect national savings: the "savings minus investment equals the current account surplus" identity suggests there must be some role for macro policy in affecting the deficit. To disentangle these two effects, we build a continuous-time open economy overlapping-generations model within which we can study the dynamic adjustments to (1) tariff changes, and (2) changes in government fiscal policy. The overlapping-generations framework is similar to Willem Buiterís (1987) overlapping-generations "semi-small" open economy. We choose this framework because, as Buiter (1981) pointed out long ago, modeling choices are limited when one desires to model private agents making rational savings decisions in an open-economy setting. With infinitely-lived agents and time-separable preferences, all agents in all countries must have the same rate of time preference if one wants to avoid a steady state in which the most patient country owns all the assets. The overlapping-generations structure we adopt allows us to model a world with different rates of time preference across countries, and hence endogenous, finite net indebtedness. This in turn allows us to model fiscal policies that affect savings behavior (and savings). Other modeling choices would either assume endogenous time-preferences or assume precautionary savings motives such as Daniel (1997). The endogenous time-preference models make the non-intuitive assumption that wealthier people are more impatient. The precautionary savings model avoids this problem, but seems cumbersome for our purposes. Within our model, changes in tariffs or changes in fiscal policy set in motion a dynamic adjustment of the real exchange rate and the current account. Our analysis emphasizes the role of international indebtedness in affecting the qualitative characteristics of the dynamic adjustment paths.