On Drudge: “U.S. Trade Deficit Hits All-Time High…”
Today on Drudge: “America’s Trade Deficit Hits All-Time High…”
By MARTIN CRUTSINGER
AP Economics Writer
… The increased foreign competition has helped to keep the lid on prices in this country, but critics say the rising trade deficit is a major factor in the loss of nearly 3 million manufacturing jobs since mid- 2000 as U.S. companies moved production overseas to lower-waged nations. Many economists believe those manufacturing jobs will never come back.
“Such a huge trade gap undercuts domestic manufacturing and destroys good U.S. jobs,” said Richard Trumka, secretary-treasuer of labor’s AFL-CIO. “America’s gargantuan trade deficit is a weight around American workers’ necks that is pulling them into a cycle of debt, bankruptcy and low-wage service jobs.”
Sen. Byron Dorgan, D-N.D., said the new deficit figure showed that “our trade policy is an unbelievable failure that is selling out American jobs and weakening our economy.”
America’s best ranchers can’t even deliver loads of bullshit this big.
First off, a silly question: does being an “economics writer” require any sort of economics background?
And while referring to “many economists” (many is one of those lovely empty words — many people like to be on the receiving end of a Cleveland Steamer, but the vast majority of people want nothing to do with it) Martin Crutsinger quotes an AFL-CIO rep and a Democratic Senator. Of course, were Marty to have quoted one of the “many” — although I’d venture to guess “vast majority” — of economists who believe those manufacturing jobs will never return, they probably would have said that, on the whole, we don’t really need nor want many of those jobs.
The story notes that in 2005 American exports actually increased by 5.7%, to a record high $1.27 trillion. It just so happens that our imports increased faster, thus the increased deficit. As more thoroughly explained at Cafe Hayek, our manufacturing output is continuing to grow despite fewer workers. In other words, our manufacturing efficiency with respect to labor is growing rapidly. Who would suspect the unions would be opposed to labor efficiency?
What’s more, $71 billion of the $108 billion, or 66%, of this year’s increase is directly related to the cost of petroleum imports. There’s not even a manufacturing issue involved there.
Although I’m not sure how much faith should be put in the numbers from the article. It alleges that US imports accounted for about 2 trillion dollars in 2005, a 12.9% increase. It also states that US exports were 1.27 trillion dollars, a 5.7% increase. Backing up from those numbers to 2004, that mean we imported 1.77 trillion dollars and exported $1.2 trillion. But that only adds up to a deficit of $566 billion, which does not agree with $617.6 billion record purported to have been set last year. For the numbers to work out, either the increase in imports was less than stated, or the increase in exports was overstated.
Anyway, Senator Dorgan complains about our weakened economy and the selling out of American jobs. What world is he living in? Even his home state has some of the lowest unemployment numbers in a nation that has some of the lowest unemployment and greatest wealth in the world.
I’ll end by reminding you to look at how the AFL-CIO always makes its statements. They speak of how “workers” are affected. It is always an issue of “workers” deserving this or “workers” deserving that. There is never an argument that “more Americans deserve (even the opportunity) to work.” It’s not about creating jobs. It is about maintaining jobs. Everyone else be damned.
UPDATE (2/12/2006): The Washington Post, used this same base story. They managed to add a bizarre quote from an economist, as well as to update the growth in US exports last year. Instead of a 5.7% increase, it was indeed a 10.4% increase. These contributions apparently came from, “Steve Hartsoe in Raleigh.”
