The Commerce Department is out with two new reports today touting the benefits of exports, and top officials sure are doing their best to talk up the new data.
Unfortunately, they’re only telling half the story.
Secretary of Commerce Penny Pritzker joined U.S. Trade Representative Michael Froman and Columbus, Ohio Mayor Michael Coleman on a press conference call, arguing that “exports are driving economic growth” and U.S. businesses are “selling more of their goods and services to markets all over the world.”Indeed, the data shows exports are up. U.S. goods and services exports totaled $2.3 trillion and supported 11.3 million jobs in 2013. On the call, Pritzker and Froman noted that it isn’t just the big guys getting into the game. Small businesses are selling products overseas, exporting everything from corn and beer to jewelry and coffee accessories.
Here at the Alliance for American Manufacturing (AAM), we love to hear that more Made in America goods are being sold abroad. But exports alone are not going to be the fix that helps our economy thrive.
We simply must address imports.
Consider this: The goods and services trade deficit reached $41.5 billion in June, according to the latest trade figures from the Department of Commerce. The deficit increased $5 billion in June 2014 compared to June 2013 — and while exports were up 2.9 percent, imports were up 4.6 percent. The trade deficit with China alone reached $30.1 million.
We’re still importing way more than we are exporting — and we’re not exporting enough of the high value goods that will support the strong manufacturing economic base we need to succeed. And as Richard McCormack notes in ReMaking America, the trade deficit costs U.S. manufacturing jobs:
The increase of $169 billion in the U.S. trade deficit between 2009 and 2012 resulted in the loss of between 700,000 and 1.4 million U.S. manufacturing jobs — or more than 10 percent of total U.S. manufacturing employment. Typically, one manufacturing job generated four jobs in the service sector, so the increase in the U.S. trade deficit with China cost the United States upward of one million jobs in 2012.”
Exporting coffee mugs and necklaces abroad is great, but it isn’t enough. We need balance.
Along with pushing exports, policymakers should take action to cut the trade deficit, particularly with China, by doing things such as enforcing our trade laws and addressing currency manipulation.
Photo of Secretary of Commerce Penny Pritzker via commerce.gov.