EXCLUSIVE by LTN economist Bruce WD Barren
“US export/trade trade is running 4.56% above the 2019 record and 15.45% ahead of the pandemic-hobbled 2020 totals, according to YTD data through April that was recently released” — Brice WD Barren
The record pace is fueled by U.S. imports, which increased 7.03% over the 2019 record year and 17.40% over last year. Exports are also performing well, up 0.89% over the first four months of 2019 and 12.50% over 2020.
This means the U.S. trade deficit is in record territory as well. As it topped $315.22 billion, the first time above the $300 billion mark in the first four months of the year.
Mexico is the nation’s top-ranked trade partner, with an increase of 2.98%, followed by Canada (2.61%) and China (13.57%). China finished 2020 as the nation’s top trade partner and tends to increase its trade in the second half of the year.
The three are accounting for 43.23% of all U.S. trade this year. In fact, they have accounted for more than 40% of all U.S. trade for at least two decades through April, with 2020 being the only exception.
Last year, U.S. trade with China had fallen so rapidly during its shutdown and then the U.S. shutdown that the three accounted for 39.80%. China’s percentage of U.S. trade for the first four months was 11.22%, the lowest total since 2008, when the world was struggling with the mortgage-led financial crisis.
This year, China’s percentage of U.S. trade was up to 14.01%, which is below the percentage in the comparable periods of the four years between 2015 through 2018.
U.S. trade totaled $1.41 trillion through April, with exports at $547.55 billion, or 39% of the total, and imports at $862.78 billion. That percentage; 39 cents on the dollar is comparable to the percentage for most years.
The overall increase in U.S. imports from 2019 of $56.68 billion was still led by China, its imports increased $10.67 billion.
So, where should the Current Administration focus?
Perhaps they should go back to basics – gross root analysis to get answers to such questions, given the fact that our current dollar is very attractive to exports, while adjusting our tariffs to reduce down imports.
Also, there are numerous incentives we can legislate to promote exports along with more advantageous financial, including tax, benefits to induce American companies to export.
However, when you have a Congress which has only minimal business experience this will be difficult. If the Federal Reserve’s objective is to provide greater employment opportunities for American workers, it must come up with solutions.
Our import imbalance can be solved, with a little extra effort, so that we can resume our position as a World leader, with a positive Trade Balance,
My suggestion: Go back to the drawing boards for we have the bests manufacturing expertise in the world, which we have allowed every other country to emulate/ duplicate. Incentivize our workers to go back to work, not rely on stimulus check to support themselves.”