Gee, I guess Clintwit and ALLGOREY are finally running out of the Reagan-Bush financial legacy. "...Surprising..." that they didn't mention that "...before..." the elections:
Trade gap soars to record
ASSOCIATED PRESS
WASHINGTON, Nov. 21 — The U.S. trade deficit surged to a record $34.3 billion in September as Americans’ appetite for cars, clothes and other foreign goods hit an all-time high while exports shrank slightly.
THE $8.7 BILLION deficit with China was the largest ever recorded with any country, pushed up by increased shipments of Chinese auto parts, telecommunications equipment and toys.
The Commerce Department reported Tuesday that the September deficit was up a sharp 15 percent from an August imbalance of $29.8 billion, well above economists’ expectations. It also easily surpassed the old record of a $31.7 billion imbalance set in July.
So far this year, the trade deficit is running at an annual rate of $360 billion, far above the record of $265 billion set last year.
The exploding trade deficit is the one dark cloud in an otherwise sterling economic performance. Strong economic growth lasting a record 9½ years has pushed the U.S. unemployment rate down to a 30-year low of 3.9 percent.
WORRIES OF A SLOWDOWN
Critics of the Clinton administration’s trade policy, however, argue that the exploding trade deficit will come back to haunt the country when domestic growth starts to falter.
Economists also worry that the billions of dollars transferred to foreigners to pay for all the imports represents a threat to the U.S. dollar and could trigger sharp drops in the U.S. stocks if foreign investors suddenly decide to dump their U.S. holdings.
A blue-ribbon U.S. Trade Deficit Review Commission created by Congress to study the problem divided sharply along party lines earlier this month on causes of the deficit.
Republicans said the imbalance reflected the fact that the United States has been growing at a much faster rate than other nations. Democrats spotlighted problems with foreign trade barriers to U.S. exports.
For September, the $34.3 billion deficit reflected a 3.1 percent surge in imports, which climbed to an all-time high of $126.6 billion. Big increases were recorded in imports of computer chips, civilian aircraft, telecommunications equipment, autos and other consumer goods, including clothing and televisions.
U.S. exports, which had set a record in August, slipped a slight 0.7 percent to $92.4 billion, still the second-highest export total on record.
Gains in overseas sales of organic chemicals, computer chips and civilian aircraft were offset by declines in exports of autos and auto parts and American agriculture products, reflecting drops in sales of soybeans, fish and rice.
The overall deficit showed a slight increase in America’s foreign oil bill, which rose 4.2 percent to $10.7 billion. The increase reflected a sharp jump in the price of crude oil, which climbed to an average of $28.98 per barrel, the highest level in 10 years.
By country, the deficit with China rose 1.4 percent to $8.7 billion, the second month it has set a record as the largest deficit the United States has ever recorded with a single country.
For the first nine months of this year, the deficit with China totaled $61.1 billion, for the first time exceeding the deficit with Japan, $60.1 billion.
The September deficit with Japan declined by 9.9 percent to $6.1 billion.
America’s deficits with Canada, $4.7 billion, and Mexico, $2.7 billion, were both records. |
