Following April’s trade deficit data, which showed a complete freefall in trade during the “Liberation Day” tariff month, May’s trade deficit rose by 18.7% on a monthly basis to $71.5 billion, according to the Bureau of Economic Analysis (BEA).
Importers slowed their buying frenzy that occurred prior to the ‘Liberation Day’ tariffs and now April’s trade figures show a not-surprising 16.3% drop for the month to $351 billion.
Decades of misguided trade policies have transformed the United States into the world’s consumer of last resort, absorbing the world’s excess savings at the expense of its manufacturing sector. U.S.-imposed tariffs are the first step towards rebalancing the system, but they aren’t sufficient.
Importers continued to front-run the April ‘Liberation Day’ tariffs in March, sending the overall trade deficit up 14% over February numbers to $140.5 billion for the month, according to the Bureau of Economic Analysis (BEA) on Tuesday.
Feeding America with abundant, healthy, locally-produced food is as important as any trade or industrial goal. Reinforcing our capacity to feed ourselves makes the nation stronger, safer, and more prosperous, whole the Big Ag status quo blindly follows a globalized model that has left far too many American farms behind.
Imports did not vanish, but their growth rate was flat at zero percent in February compared to January after nearly two months of importers rushing in orders ahead of tariffs. February goods and services imports were $401 billion, a statistically insignificant change from January, the Bureau of Economic Analysis said.
It’s a straight line up. The goods and services deficit kicked off January by rising a record 34% over December. Importers are front running tariffs and getting in their orders before everything changes, likely at some point after April 1.
The evidence is clear: neither tariffs nor the surge of imports from trade liberalization have had a significant effect on inflation, positive or negative.
Thanks in no small part to a strong dollar, and the animal spirits of the U.S consumer and businesses, the United States goods trade deficit broke a record in 2024.
It’s past time for Washington to implement a trade policy that rebuilds independence and prosperity for America’s domestic farmers and manufacturers.
