The U.S. Census Bureau reported Friday that the January goods and services trade deficit was an enormous, humongous $45.68 billion. The January goods deficit was $63.7 billion, offset by an $18 billion services surplus.
Both imports and exports were down, but exports hit a 5 1/2-year low thanks to a “strong” dollar, currency manipulation and weak economies outside of the US. According to Reuters, automobile imports were the highest on record.
According to the Census Bureau, “The [goods] deficit with China increased $1.4 billion to $31.1 billion in January. Exports increased less than $0.1 billion to $8.6 billion and imports increased $1.5 billion to $39.8 billion.”
Trade Deficit Hits Jobs
The trade deficit is a metric for jobs leaking out of the economy, which causes wages to stagnate. The continuing trade deficit is the reason that Friday’s February jobs report showed that manufacturing lost 16,000 jobs. Scott Paul, President of the Alliance for American Manufacturing said of the jobs and trade deficit report:
“Working people in states like Michigan and Ohio feel the lousy manufacturing job loss and growing trade deficit with China, even if Wall Street and D.C. do not. If you’re wondering why there’s so much interest in political insurgencies among both Democrats and Republicans this year, here’s your answer.
“We’ll never experience a true manufacturing resurgence in the United States unless we get trade policy right and get a lot tougher with China. So far I haven’t seen the will on Capitol Hill or the White House to do that, even though I see it on the campaign trail.”
Michael Stumo of the Coalition for a Prosperous America (CPA) said of the report,
“The administration’s willful disregard for poor trade performance is enabled by the establishment think tanks and many congressional leaders, to the detriment of the U.S. economy. The simple, unassailable fact is that trade deficits shrink our economy while trade surpluses grow our economy. The presidential campaign shows that voters support candidates that want a fundamentally different trade policy that puts American workers, companies, farmers and ranchers first.”
Republican presidential candidate Donald Trump has made this a centerpiece of his campaign, spouting the trade deficit numbers in stump speeches and debates, and explaining how our country’s trade policies are costing so many jobs.