The enormous, humongous US trade deficit continues to drain jobs, wages, and prosperity from our country’s economy. We close factories and fire workers here, move factories and jobs there, and because the goods now cross a border our elites brag that they have “increased trade.” Meanwhile, the middle class erodes and the extremely wealthy “investor” class gets even wealthier. (Note: Republican presidential candidate Donald Trump’s criticisms of our trade policies do not mean that he will fix this. Trump advocates driving US wages down so low that companies won’t want to move factories to find lower wages. This likely isn’t what Trump supporters think they’re voting for.)
The U.S. Census Bureau reported Friday that the July trade deficit was $39.5 billion. This is $5.2 billion lower than June’s (revised) $44.7 billion.
Exports were up $3.4 billion from the prior month, and imports were down $1.8 billion. An increase in soybean exports of $3.6 billion helped decrease the overall trade deficit. So the soybean jobs should be up.
The deficit in “real goods” was down $6.3 billion in July, to $58.3 billion. According to the report:
- Real exports of goods increased $3.5 billion to $120.7 billion.
Real imports of goods decreased $2.8 billion to $179.0 billion.
The trade deficit with China went up $1.4 billion to $29.4 billion, with exports to China up $0.4 billion to $9.8, and imports up $1.8 billion to $39.2 billion. This, of course, counteracts lots of those soybean jobs.
According to the Wall Street Journal, this drop in the monthly trade deficit could be a “one-off”:
While the monthly increase in exports will support third-quarter growth, some economists warned it could be a one-off.
“The massive surge in soybean exports likely will reverse,” said Ian Shepherdson, chief economist at Pantheon Macroeconomics. “In the meantime, though, these data suggest that foreign trade is set to make a positive contribution to third-quarter GDP growth.”
Both exports and imports have fallen since the end of 2014 amid economic turmoil and lackluster growth in many overseas economies. Trade with other nations has become a talking point in the U.S. presidential campaign, with voters expressing concern that substituting imported foreign-made goods for domestically produced goods hurts U.S. workers.
Voters are “expressing concern” that “that substituting imported foreign-made goods for domestically produced goods hurts U.S. workers,” because that’s exactly what it does.