Posts Tagged ‘Trade Deficit’

Why millions of ordinary Americans back Trump

March 11, 2016

Donald Trump is a con man, a racist and a bully.  The record is clear.  But the world is full of confidence men, racists and bullies.  What sets him apart?

Thomas Frank, author of What’s the Matter With Kansas? and other great political books, took the trouble to listen for himself to several hours of Trump speeches (which I confess I have never done).

I saw the man ramble and boast and threaten and even seem to gloat when protesters were ejected from the arenas in which he spoke.  I was disgusted by these things, as I have been disgusted by Trump for 20 years.

thomasfrank4718But I also noticed something surprising. In each of the speeches I watched, Trump spent a good part of his time talking about an entirely legitimate issue, one that could even be called left-wing. 

Yes, Donald Trump talked about trade.  In fact, to judge by how much time he spent talking about it, trade may be his single biggest concern – not white supremacy.   Not even his plan to build a wall along the Mexican border, the issue that first won him political fame.  He did it again during the debate on 3 March: asked about his political excommunication by Mitt Romney, he chose to pivot and talk about … trade.

It seems to obsess him: the destructive free-trade deals our leaders have made, the many companies that have moved their production facilities to other lands, the phone calls he will make to those companies’ CEOs in order to threaten them with steep tariffs unless they move back to the US.

Trump embellished this vision with another favorite left-wing idea: under his leadership, the government would “start competitive bidding in the drug industry”.  (“We don’t competitively bid!” he marveled – another true fact, a legendary boondoggle brought to you by the George W Bush administration.) 

Many liberals think that Trump supporters are simply out of touch with reality.  But they themselves are out of touch with how trade and immigration are changing American life.

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The anatomy of the U.S. balance of trade

March 9, 2016

us-trade-balance1

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.

USA-Export-35e8

USA-Imports-2015-2836

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.