[Willie Green]

For some unknown reason, this article is previously posted in the General/Chat forum.
I am intentionally reposting it to the News/Activism forum where it appropriately belongs.

[Willie Green]

ping

[Alberta's Child]

The October trade deficit set a one-month record of $55.5 billion. Exports were up $600 million, but imports were up $5.1 billion, or nearly nine times as much. With imports overall running more than 50% ahead of exports, the notion that the United States can export its way out of the trade deficit is unrealistic. Where are American producers going to find new, accessible markets worth $635 billion that they can capture in the face of foreign rivals? There is only one place -- the American market that has been lost to imports. But there was no policy discussion at the conference aimed at taking back lost markets, either at home or abroad.

This is the one statement that alwasy confuses the heck out of me. I understand the problem with long-term, recurring trade deficits in many sectors of the economy, but I've always contended that these numbers tend to be almost meaningless over the last few months because of the enormous impact that energy prices have on trade balance figures.

When it comes to the country's trade balance in commodities that are not end-products themselves but are only raw materials to be used elsewhere in the chain of production/consumption, I would make the case that a large trade deficit is a GOOD thing. If the U.S. maintains a trade deficit of $X in oil, for example, then this is a clear sign to me that oil is more readily obtained at lower cost outside the U.S. If we didn't have access to this foreign oil, we'd be spending $X plus more on the same oil.