The trade deficit caused first quarter US GDP growth to be basically zero – specifically 0.2%. Exports were down 7.2% while imports were up 1.8%.
The Bureau of Economic Analysis news release says:
The increase in real GDP in the first quarter primarily reflected positive contributions from personal consumption expenditures (PCE) and private inventory investment that were partly offset by negative contributions from exports, nonresidential fixed investment, and state and local government spending. Imports, which are a subtraction in the calculation of GDP, increased.
Real exports of goods and services decreased 7.2 percent in the first quarter, in contrast to an increase of 4.5 percent in the fourth. Real imports of goods and services increased 1.8 percent, compared with an increase of 10.4 percent.
We have more trade agreements than ever before. Paul Ryan, Orrin Hatch and Barack Obama want many, many more agreements. Both the President and other trade deal promoters had a fair shot to prove their strategy would work. It did not. They failed.
Doubling down on failure is stupid.
Fast Track trade authority should not be approved. It is a ratification of the 1900’s era trade deals that gutted our economy. We need to reject Fast Track and undertake a new approach.
Balanced trade should be the new strategy. Imagine the growth if we achieved that!