Will President Trump turn his attention to this dismaying trend?
Bad news for people who like good news: The Commerce Department reported a goods trade deficit with China of $30.2 billion in December, which is $1.8 billion higher than the previous month.
While it’s bad news, it must be said: This is consistent, predictable news. The United States has run a monthly goods trade deficit of approximately $30 billion for the past three years. The annual goods trade deficit with China alone totaled $347 billion in 2016. In 2015 it was $367 billion. In 2014, $344 billion. In fact, the last time we ran a trade deficit with China that didn’t average out to over $20 billion a month was the end of 2006.
Over ten years ago! Back then, Mel Gibson’s Mayan adventure movie, Apocalypto, was at the top of the box office ….
… and teenagers were all buying albums made by somebody called Incubus.
Man, I don't get teenagers.
Anyway, China chronically accounts for a huge chunk of our larger annual goods trade deficit in non-petroleum goods, which the Economic Policy Institute notes reached an all-time high in 2016:
That’s a serious problem. These persistent trade deficits, particularly with China, are indicative of the existence of a host of other issues with China that feed those deficits: its history of currency manipulation, maintenance of unnecessary production capacity, direct government subsidies for key industries, and a whole lot of devices meant to block imports into its own market. That has lead to significant job loss in the United States in the last 15 years.
So, in addition to its exports keeping the shelves stocked at Walmart, you could say that China is exporting unemployment.
The world is waiting for President Donald Trump, who rode to office by selling a real tough line on American trade policy with China, to turn his focus to this relationship. It’s been almost three weeks since his inauguration, but it’s currently elsewhere.
Until the United States and the administration that leads them get serious about the issues that affect U.S. manufacturers — by proposing and then working with Congress to pass actual policy — expect this monthly trade deficit to continue.