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Trade Deficit exceeds 600 Billion dollars for 2004 ... growing faster than a fire ant nest!
by Mike Crane

Several months ago (see: US Trade Deficit - Bragging about failure) we projected a record breaking trade deficit in excess of $600,000,000,000.00 as a result of what we considered flawed and irresponsible government policies. In the intervening months we have received predominately negative responses from mostly Republicans who have accused us being just about every critter of poor reputation under the sun.

In each case we replied that we hoped they were right and we were wrong. But sadly, we were not wrong. The December 2004 Trade numbers were officially released today. An excerpt from the US Department of Commerce press release is listed below and a link to the entire report.

For the calendar year 2004, the official trade deficit numbers are as follows:

The results for the calendar year, 2004 was summarized in the government's own words as follows:

The goods and services deficit in 2004 was $617.7 billion.  As a percentage of U.S. gross domestic product, the goods and services deficit increased from 4.5 percent in 2003 to 5.3 percent in 2004.

As it turns out - instead of being one of the despicable critters we were called we were actually being optimistic. The governments own numbers are worse than we projected.

The outlook for the future is not promising. Failing some unexpected change in the polices of the Bush Administration's policies you can expect these dismal numbers to get worse next year. As reported in Trade Deficit demonstrates failed government policies even agriculture is expected to post a negative trade balance in calendar 2005.

Even new age rocket scientist Alan Greenspan has stated that increasing trade deficits can not continue forever (see: Trade Deficit - even Greenspan recognizes the failed policies ...). But standing in defiance of all known economic knowledge the Bush Administration and both Republicans and Democrats in Congress continue to tell us that this is "good for us" and that the Bush Administration has a "strong dollar" policy.

The chart at the right provides a graphical view:

Adding the 2004 results to this chart only requires extending the downward trend another year. Do you really believe that this is "good for us?"

It is true that in any economic event somebody benefits. But we find it hard to see how Americans will benefit from what even Alan Greenspan calls excessive trade deficits.

This deficit means that we are buying products that are no longer made in our country. Americans who no longer have a job making these products certainly have not benefited. But the Bush Administration and Congress says this is "good for us".

The deficit means that more jobs have been outsourced to foreign countries. The Americans who used to have jobs to perform these services are now unemployed and American companies import more services. The Americans who used to have these jobs certainly do not benefit from growing trade deficits. But the Bush Administration and Congress say this is "good for us."

Even Agriculture is expected to have a negative trade balance next year. American farmers who used to grow the food products now being imported do not benefit from a negative agriculture trade balance. But the Bush Administration and Congress tell us this is "good for us."

The recent job creation reports called job creation as "weaker than expected." This is just political double speak. The following is a translation of "weaker than expected" into what we call POOR Economic terms"

Duh! Looks like the jobs have moved to other countries but we can't say that  - it would cost us votes and more importantly would hurt our campaign contributions from corporations. How can we spin this to sound OK? Lets just tell them that it is weaker than expected but we are making good progress!

Folks George Bush, Karl Rove and the members of Congress have enough intelligence to be able to read the numbers and certainly have better access to facts than you do. They know that we can not continue running massive trade deficits forever. They know that this is not good for America. It does not take a rocket scientist to look these numbers to know that something is wrong. It also does not take a rocket scientist to know that they are misleading the American people.

Look at the chart again. Look at the steady and ever increasing growth of trade deficits since NAFTA was passed, sponsored by both Republicans and Democrats in Congress. Under both the Clinton and Bush Administration both the Republicans and Democrats have supported increased free trade, out sourcing and increased immigration.

Both Republican and Democrats have ignored the steady loss of American jobs, the increasing national debt and the increasing trade deficits. How long are you, the American citizens,  going to let the government that you elect and pay for - continue to get away with telling us that this is "good for us?"

Ooopppsss, excuse me for the inaccurate statement. You as American citizens are not paying for everything your government is doing. You are placing a growing portion of this debt on your children and grandchildren. You have given your government a credit card in your grandchildren's name.

We hope that you will give this issue some consideration, we do believe that it is important and every year that we continue this downward trend it becomes more important.

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2005 Trade Deficit Projection:

Our projection for the annual trade deficit in 2005 is between $675,000,000,00.00 and 690,000,000,000.00. If CAFTA is passed it will be closer to the high end, if CAFTA fails it will be closer to the lower number. If CAFTA is passed this will represent not only a record trade deficit, but will also be the largest increase in the deficit ever. A record breaking record of failure!