Trump has boasted of a trade deal with China that the administration hopes to complete in the near future, but economists say any such deal would only divert exports from other countries, shrinking the gap between the us and China but leaving the overall deficit largely unaffected.
The trade deficit is the difference between how much goods and services the USA imports from other countries and how much it exports.
The U.S. Census Bureau reported that the U.S. goods trade deficit reached a record of $891.3 billion in 2018, an increase of $83.8 billion (10.4 percent).
The trade deficit has deteriorated despite the White House's protectionist trade policy, which President Donald Trump said is needed to shield US manufacturers from what he says is unfair foreign competition. So far, Washington has imposed tariffs on almost $250 billion of Chinese imports.
A significant factor in the historically large deficit are tariffs from the administration against numerous foreign-made products such as solar panels, washing machines and raw building materials like steel and aluminum.
"That will take time and if the Chinese growth is as soft as most economists believe, it is hard to see how they can ramp up demand for US products very much this year", said Joel Naroff, chief economist at Naroff Economic Advisors in Holland, Pennsylvania. And he may settle for a deal that falls short of Beijing agreeing to make concrete and enforceable changes to curb theft of USA intellectual property, including cybertheft. The recent widening in the deficit has been driven in part by weakening exports, according to Daniel Silver, an economist at JPMorgan.
Apart from that, the Trump administration launched a full-scale trade war against China.
"This is a major reason why economists say, 'You really don't want this as your scorecard, "' said Phil Levy, a former senior economist for trade with president George W. Bush's council of economic advisers.
"It's more substituting, a reshuffling of trade", Irwin said.
Sony Forced To Refund After Major Playstation 4 Crash
A thread has been created on EA's website so that players can further detail what issues they are personally experiencing. For now, EA is looking into problems affecting PS4 players; however, there are reports of similar issues on the Xbox One.
The U.S. posted record imports from 60 countries in 2018, led by China, Mexico and Germany. Unless these trends are offset by a rapid decline in the value of the US dollar, rapidly rising trade deficits could be devastating for USA manufacturing, likely giving rise to massive job loss on the scale experienced in the 2000-2007 period, when 3.5 million USA manufacturing jobs were lost.
That study also found that workers in Republican-leaning counties, especially in farm states, suffered the greatest losses from tariffs that U.S. trading partners imposed in retaliation for the president's actions.
Trump's chief trade negotiator, Robert Lighthizer, a year ago concluded a revision of the North American Free Trade Agreement, and he is now in the throes of trying to wrap up a deal with China. The answer largely (though not exclusively) has to do with Trump's own economic policies. Yet numerous president's critics do not blame him for this, saying some fluctuations in the trade deficit are largely beyond his control.
On an annual basis, the trade gap reached the largest total since 2008, when it was $708.7 billion. While goods exports from the USA increased by $117.8 billion, according to the Census Bureau data, its imports rose by $202.2 billion. Higher imports equal bigger trade deficit.
It is that trade statistic that now hangs over several ongoing trade discussions, including an expected trade summit with China toward the end of March, that could largely reshape America's participation in global commerce.
At the open, the Dow lost 15 points after Bloomberg reported that Donald Trump was pressuring United States negotiators to make a deal with China soon in the hopes of prompting a market rally.
Washington and Beijing have been locked in intense negotiations to end a months-long trade war.
Other studies show tariffs costing US consumers tens of billions of dollars in higher prices, not to mention the $8 billion in tax dollars sent to prop up farmers hard hit by Chinese retaliation. Figures from the US Department of Commerce point to a deficit of $ 621 billion.
Despite signals from Chinese and USA officials that some truce could soon be at hand, there are few signs of any truly transformed trade relationship.