An interesting economic tidbit – trade deficit

A relatively small economic news item is worth noting given the amount of attention given by the president. In an article by the AP’s Martin Crutsinger entitled “US trade deficit surges in July to 12-year high,” the US trade deficit “surged in July to $63.6 billion, the highest levrl in 12 years…”

Per the article, “the Commerce department reported…the gap between what America buys and sells to foreigners, was 18.9% higher than the June deficit of $53.5 billion. It was the largest monthly deficit since July 2008 during the 2007 – 2009 recession.” The increase was “driven by a record 10.9% increase in imports” with a corresponding “8.1%” fall in exports.

Let that sink in. We are living in unique times with the pandemic. But, the whole world is exposed, not just the US. There are two points to be made.

First, the president has placed tariffs on major trading partners, who responded in kind. As economists have long noted, no one wins a trade war. Buyers just find less costly sources.

Second, America has so woefully handled the COVID-19 pandemic, the world is aghast. With around 4% of the world’s population, the US has around 22% of the global COVID-19 deaths. And, sadly the deaths continue. This truism runs in direct contrast to what the president touted at the RNC.

With other countries less impacted than we are, they can get closer to normal than we can. But, our folks can still buy from home. So, these numbers are not a surprise. As with any issue, the only way to solve a problem is to admit it exists.

8 thoughts on “An interesting economic tidbit – trade deficit

  1. I seriously doubt that the person in the Oval Office even understands how a trade surplus/deficit works, or what it means for the economy that we now have the largest trade deficit in 12 years. I doubt you’ll hear a word from him about this, for he will seize and focus on the lower (yet still very high) unemployment rate for August … one which I’m not sure I believe. Neither will he make note of the stock market decline both yesterday and today, for it is not to his advantage. Most disturbing to me, though, is that he is largely ignoring the coronavirus pandemic. He’s forced a reduction in testing, so the number of new cases looks lower, but that is a false narrative. And, we are still experiencing over 1,000 deaths EVERY day! And he ignores it. “It is what it is.” And then, there is that pesky thing called the National Debt that is now at nearly $27 million. Sorry … I let one topic lead me to the next! Good post … people need to be reminded!

    • Jill, you speak the truth. Keep on preaching it. The trade deficit is really less of a concern than Trump makes it out to be. We buy stuff more than we sell stuff. That is what happens when you offshore as much as we have done. Now, that other US debt and deficit thing is a major concern. Keith

  2. 4% population and 22% world cases. I’m trying to absorbed that. 4% population and 22% world cases. Do you have a functioning health service in your first world super power country Keith? That’s an amazing statistic. 4% population and 22% world cases. May the Lord bless your ‘sick’ nation.

    • David, and this person stands up at the RNC and says we are the envy of the world. On top of his horrible mishandling and lack of leadership on the pandemic, he is has been trying to unravel health coverage for over twenty million for three plus years and has no plan. In fact, before the 2016 election, he said he had a plan, but you had to elect him to find out. As with many other things, he lied. He has no plan.

      We are a sick nation. We have the highest costing healthcare system in the world and we are around 40th in health outcomes – that was before the pandemic clusterf**k. Keith

    • David, per conservative pundit David Brooks said last night on PBS Newshour, Jeffrey Goldberg of The Atlantic is a top notch reporter who has released more than a few scoops based on his Pentagon sources. The fact four other news agencies, including Fox News, corroborated the story gives it even more legs.

      Plus, the story is very believable based on what Trump has said in public on camera. Keith

  3. I’ve tried to stay away from your county’s politics, but the veteran’s comments as reported in the Atlantic were simply beyond the pale. Perhaps here’s an issue on which around your country can coalesce. Repugnance at the attitudes expressed might solidify resistance

    • David, see my note above in response. I started sharing with Senators and my Congressman by email and with staff, “What else will you have to defend that the president said or did? And, you do not even know if he has already committed the sin?” When I first said this, he had already tried to extort Ukraine? Now, he said these words several months ago. There are more skeletons in the woodwork.

      GOP Senators have been eerily silent, but they must say something or they concur with silence. Keith

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