I’m still catching up from last week. On Thursday the Bureau of Economic Analysis announced that the trade deficit in May moderated slightly to $44.4 billion. (A link to the report is provided above.) But the real news is that the deficit in manufactured goods set yet another record – $49.5 billion. Here’s the chart: Manf’d Goods Balance of Trade.
Manufactured exports rose slightly in May, but not enough to keep pace with the President’s goal of doubling exports by 2015. Manufactured exports lagged that goal in May by a record margin of $45.0 billion. In fact, manufactured exports haven’t risen in the past 26 months. Here’s the chart: Manf’d exports vs. goal.
Even if we give the president the benefit of the doubt and assume he meant exports of all goods and services, that figure also lagged the president’s goal by $66.3 billion.
Remember the trade deal that President Obama signed with South Korea two years ago, which he hailed as a “big win for American workers?” Our trade deficit with South Korea set another record in May: $2.7 billion. In 2011, our trade deficit with South Korea was $13.2 billion. Last year it was $20.7 billion. So far, 2014 is on track to handily beat that record. Thanks, Mr. President! Please, if you’re not going to do something to restore a balance of trade, stay out of any further trade negotiations unless you hire someone competent in the subject.
We keep hearing talk of a “manufacturing renaissance” in the U.S., but the facts speak otherwise. Our trade policy continues to drain ever more from the life of the manufacturing sector of the economy. Trade policy is just one element of a clear pattern that has emerged over the course of the Obama presidency. It’s a pattern of zero follow-through. He very publicly proclaims lofty goals and draws red lines, but then sits back and does nothing toward accomplishing those goals. He’s become the quintessential “bench-warmer,” filling the seat in the White House until he can be replaced, hopefully by someone with some drive and some competence.