Trade Tariffs and the Largest Trade Deficit in US History
U.S. trade hit a new milestone in 2018, according to government data released today. For the first time, U.S. trade with the world topped $4 trillion, and for the first time in 12 years, the United Statesset records for total trade, exports, imports and the size of its trade deficit – all in one year.
One record that didn’t fall? The U.S. and China missed surpassing the world record trade between U.S. and Canada in 2014 by $2.2 billion. U.S. exports to China fell by more than $4 billion in December alone.
The Census Bureau data was analyzed by WorldCity, which chronicles that commerce in customized TradeNumbers publications, videos, online data, and events for a wide range of markets, from the Port of Los Angeles to MiamiInternational Airport, the Port of Virginia to border crossings in Eagle Pass, Laredo and Pharr, Texas.
“There are three primary drivers behind the records,” said WorldCity President Ken Roberts, who is also a regular Forbes.com contributor and member of the Federal Reserve’s Trade and Transportation Advisory Panel.
“A strong U.S. economy and imports from China – which are connected – and a tremendous surge in oil exports helped push U.S. trade past $4 trillion and at the same time top the U.S. deficit record set in 2006.”
The voracious appetite for Chinese imports led to another record, Roberts said. For the first time, one nation, China, sent imports valued at more than $500 billion to another country, the U.S.
For the year, U.S. trade totaled $4.21 trillion, with exports at $1.66 trillion and imports at $2.54 trillion. The U.S. deficit with the world was $878.68 billion.
“It’s very easy to get hung up on the deficit, which is quite a large number,” said Roberts, whose company hosts events across the U.S., produces weekly Trade Matters videos, and updates data monthly at ustradenumbers.com for every U.S. airport, seaport and border crossing.
“But relative to total trade, it’s not much bigger than it was decades ago. For every dollar of U.S. trade in 2018, 40 centswas a U.S. export, the same as eight of the last 10 years.”
