The U.S. Trade Deficit: An Overview (CRS Report for Congress)
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| Release Date |
Revised Dec. 9, 2020 |
| Report Number |
IF10619 |
| Report Type |
In Focus |
| Authors |
James K. Jackson |
| Source Agency |
Congressional Research Service |
| Older Revisions |
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Summary:
The trade deficit is the numerical difference between a
country’s exports and imports of goods and services. The
United States has experienced annual trade deficits during
most of the post-WWII period. Some observers argue that
the trade deficit costs U.S. jobs, is unsustainable, or reflects
unfair trade practices by foreign competitors. Most
economists contend this mischaracterizes the nature of the
trade deficit and the role of trade in the economy. In
general, most economists conclude the trade deficit stems
largely from U.S. macroeconomic policies and an
imbalance between saving and investment in the economy.
Economists also conclude that trade creates both economic
benefits and costs, but that the long-run net effect on the
economy as a whole is positive. At the same time, some
workers and firms may experience a disproportionate share
of short-term adjustment costs. On March 31, 2017,
President Trump issued an Executive Order directing key
agencies to prepare a written report within 90 days (not yet
published) on significant trade deficits with U.S. trading
partners, including a focus on: unfair trade practices; and
the impact of the trade deficit on U.S. production,
employment, wages, and national security.
