The U.S. Census Bureau reported Friday that the January goods and services trade deficit was $41.8 billion in January, down $3.8 billion from $45.6 billion in December (which was revised down a billion). This is a drop of 8.3% from the prior month, which was a two-year high.
Both imports and exports fell. Imports of goods and services fell 3.9% to $231.2 billion, partly due to reduced-priced oil imports. Exports fell 2.9% to $189.4 billion as the global economy cooled and the US dollar strengthened, making US goods more expensive internationally. West Coast port disputes played a role, disrupting supply chains.
The Wall Street Journal explained the drop in oil imports:
“Last month, the trade deficit for petroleum products fell to $10.69 billion, its lowest level since November 2003. The average price of a barrel of imported crude oil was $58.96 in January, down from $73.64 in December and $90.21 a year earlier, the Commerce Department said.”
The monthly goods trade deficit with Korea in January 2015 topped $3 billion. This was the largest monthly trade deficit with Korea on record. Our trade deficit with Korea has consistently been higher since the KORUS “free trade” agreement — the template for the Trans-Pacific Partnership (TPP) — went into effect.
Alan Grayson Explains Trade Deficit Harm
Trade is supposed to be balanced. That is where the word “trade” comes from. But since the neo-liberal “free trade” pro-corporate ideology took hold in the late 1970s the US has consistently run a trade deficit every single year, and it just gets worse. This literally drains our economy, jobs, wages, factories, entire industries and our ability to make a living as a country.