30 Years of ‘Free Trade’ Brings 400% Trade Deficit With China

There is much debate over the negative effects of massive trade deficits, and what the best strategy for correcting them might be, but it’s hard to deny the U.S. trade deficit with China is staggering in scale … and it got that way after just a few decades of old-school “free trade” orthodoxy.

Raul Amoros of HowMuch.net puts the issue in perspective:

The start couldn’t be more balanced: in 1985, the U.S. exported $3.9 billion to China, and imported goods and services for the exact same amount. But by 2015, there was a staggering imbalance, to China’s advantage, of $365.7 billion – an all-time record, not just for U.S.-China trade, but for any bilateral trade, ever.

It’s not that U.S. exports to China haven’t increased. They have, and by a lot. America exported an impressive $116.2 billion into China last year, 30 times more than in 1985. That makes China the U.S.’s third-biggest export market, nearly twice as important as Japan ($62.5 billion), in fourth place. But that’s still a lot less than U.S. exports to Canada ($280.3 billion) or Mexico ($236.4 billion). Meanwhile, Chinese exports to the U.S. have exploded. In 2015, China exported $481.9 billion to the U.S. – an amazing 123 times more than in 1985.

Amoros illustrated this with an animated GIF that shows billion-dollar blocks building into towers of trade for the U.S. and China. The American side of the graph rolls in and out like the tide a few times, while the Chinese tower climbs relentlessly upward to four times the American size. (Read more from “30 Years of ‘Free Trade’ Brings 400% Trade Deficit With China” HERE)

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