Posts Tagged ‘Imports’

The anatomy of the U.S. balance of trade

March 9, 2016


Source: How Much

The U.S. Census Department reported that the United States exported more than $1.5 trillion worth of goods and services in 2015 and imported more than $2.2 trillion worth, leaving a trade deficit of $735 billion dollars.

The map above and the two below, produced by How Much, a cost information web site, shows the flow of trade into and outside the United States last year.

The red countries are countries with which the United States has a trade deficit.  They sell us Americans more than they buy from us.  The green countries are countries with which the United States has a trade surplus.  They buy more from us Americans than they sell to us.



A couple of things jump out at me as I look at the three maps.

The oil-exporting countries – Saudi Arabia, Algeria, Nigeria, Venezuela, even Canada – are not large on the map.  Our U.S. trade deficit is mainly in manufacturing, not energy.  Domestic production satisfies about 85 percent of U.S. energy needs.

The United States has trade deficits with many countries, such as Germany, France, Sweden and Canada, that have generous welfare states, strong labor unions and high wages.  I don’t think impoverishment of American workers is not the key to a favorable balance of trade.

The North American Free Trade Agreement has not improved the U.S. trade balance with Canada and Mexico, and I can’t think of any other trade agreement since then that has done so with any other country.

Afterthought [3/10/2016].  The United States does a free trade agreement and a positive trade balance with Colombia, but I’m not sure what the balance would be if the revenues of the cocaine trade were included.