In 2011, the U.S. trade deficit with Ireland soared to $31.6 billion, blowing away last year’s record of $26.6 billion. The trade deficit with Ireland has grown by 277% since 2001. Here’s a chart of that growth:
By comparison, our trade deficit with Ireland is small potatoes compared to China – about one tenth as large. However, China is a vastly larger country. Expressed in per capita terms, our trade deficit with Ireland, at $6,695 per person, the highest in the world, is 30 times worse than our per capita trade deficit with China.
The point here is not that we need to do something about Ireland, any more than we need to do something about China or any other one nation. The point is that, although China draws all the fire for our trade deficit and loss of manufacturing jobs, our trade results with China are really no different than our trade results with other densely populated nations – Ireland included. In nearly every case, our trade deficit with densely populated nations worsened in 2011. The problem isn’t China, or their low wages or currency manipulation or unfair trade practices. The problem is U.S. trade policy that attempts to apply free trade in situations where it simply isn’t applicable – where it has absolutely no chance of doing anything other than draining our economy of its jobs and wealth.