China trade deficit shrinks as deficit with EU hits record high

“the deficit in exports versus imports from China shrank to $345.6 billion, down about 18 percent from a record high level of $419.5 billion in 2018.

But the U.S. trade deficit in manufactured goods with all countries was relatively unchanged in 2019 at close to $1.048 trillion because importers turned to other nations after Trump hit China with tariffs ranging from 10 percent to 25 percent.

Some of the beneficiaries of that shift included Mexico, Vietnam, Taiwan, South Korea, Japan and members of the EU.

The trade deficit with the EU hit a record $177.9 billion in 2019, while the gap with Mexico was a record $101.8 billion”

“tariffs Trump has imposed on approximately $370 billion worth of Chinese goods have increased costs for U.S. manufacturers”

“That helps explain both the slowdown in U.S. manufacturing output and slight decline in the manufactured goods trade deficit in 2019”

“The U.S. usually runs a surplus in agricultural trade. However, that surplus shrank to $23 billion in 2019, from $26.5 billion in 2018, at least partly because of the retaliation that China and other countries on American exports imposed in response to Trump’s tariffs.”

“One bright spot in the trade report is the sharp drop in the oil and gas trade deficit, which fell to $29 billion in 2019, from $69.5 billion in 2018, because of increased U.S. production and exports.

The oil and gas trade deficit reached as high as $317 billion in 2008, but has fallen steadily over the past decade because of new production techniques.”

“Trump still is mistaken to believe that the trade deficit is driven primarily by unfair foreign trade practices or bad trade deals, economists point out. Instead, other factors, such as the size of the U.S. budget deficit and the strength of the U.S. economy play a much bigger role in dictating trade flows.

“The irony is the stronger the U.S. economy is compared to our major trading partners, like the European Union and China, the more likely it is the trade deficit will go up because we will have stronger demand,” Griswold said. “The vast majority of economists would say that’s perfectly fine, but it does put this administration in an awkward spot.””

New conservative climate plans are neither conservative nor climate plans

“Over the years, the terms “free market” and “limited government,” like so many conservative principles, have devolved into little more than rhetorical tics, bits of sloganeering that bear no resemblance to actual conservative governance.

What conservatives seem to have decided is that regulations, restrictions, or limitations — anything that might upset or inconvenience the corporations generating greenhouse gases — are the bad kind of big government and a bad way of picking winners and losers. Government subsidies, tax credits, and grants — anything that might benefit big corporations — is the good kind of big government and a good way of picking winners and losers.”

“There are plenty of models that show we will need carbon capture (both industrial and natural) to supplement other efforts to reduce emissions. We probably can’t hit our mid-century targets without it.

But there is no model in the world showing emissions falling fast enough with nothing but carbon capture, with fossil fuels continuing their current headlong expansion.

The fossil fuels that remain behind after deep decarbonization, the ones that still need their emissions captured and buried, will be a small vestige of the current fossil fuel regime. That is what every credible model shows. That is the cold, hard truth at the heart of the climate dilemma: There is no avoiding the imperative to reduce fossil fuel combustion and the social and economic disruptions that come with it.

Current Republican efforts to feign climate policy conspicuously fail to grapple with that truth.”

The real state of the union

“If you didn’t know American politics had been turned upside down by Trump’s election win, nothing in the macroeconomic data would suggest that anything at all happened in January 2017”

“That’s not to deny Trump any credit. He made a sensible selection for Federal Reserve chair and has presided over a healthy dose of fiscal stimulus, and his trade policies haven’t been as disruptive as the most alarmist critics warn. But at the same time, his tax cuts haven’t delivered the kind of investment boom he promised, and in general, all his record-setting economic numbers are continuations of previous trends.”

“Under Trump, we have seen a sharp slowdown in net immigration that has helped reduce US population growth to a trickle. The foreign-born share of the population, however, is not falling despite the immigration crackdown because American women are also having fewer babies.”

“The number of babies women say they’d ideally like to have isn’t declining; we are just seeing the gap between ideal fertility and actual fertility get bigger and bigger each year. According to surveys, the main reason is the high (and growing) cost of child care — a problem that a “good economy” alone doesn’t fix, since child care is so labor-intensive.”

Trump Campaigned on Saving Factory Jobs, but U.S. Manufacturing Just Went Through a Year-Long Recession

“although it is true that America’s economy has, on the whole, performed admirably well under Trump, with unemployment numbers hovering near historic lows, one of the notable dark spots over the last year has been manufacturing jobs—particularly those in the upper midwest.

Last week, the Federal Reserve reported that U.S. manufacturing was in a recession for all of 2019. This wasn’t slow growth; the sector actually became smaller. The slowdown was relatively mild, with factory production shrinking by about 1.3 percent. But it was the worst performance since 2015, the year that Trump started his presidential campaign.”

“the uncertainty and increased costs surrounding Trump’s trade war, which was billed as a way of supporting American factory jobs, has instead wreaked havoc on an export-heavy sector that relies on the global flow of goods to operate. Trump’s interventions were intended to prop up U.S. manufacturing. But they backfired, harming the people he claimed to help—who also happen to be some of the people who played a crucial part in his election.”

“Farming, another industry that Trump campaigned on helping, was so harmed by the trade war that the Trump administration ended up spending some $28 billion—more than double the price tag of President Obama’s auto bailout—to keep them afloat.”

“Trump’s attempts to prop up the manufacturing sector through tariffs and trade restrictions didn’t just fail to work; they actively harmed the people they were intended to help. So even as Trump has overseen an economy that has many bright spots, the sector and worker demographic he tried to boost ended up struggling.”

Capitalism is turning us into addicts

“Capitalism is great at making people want things they don’t need.

And of course this is what we should expect from a system that runs on production and consumption. Companies make and sell products and those products have to be consumed by as many people as possible — that’s what makes the whole thing work.

So it’s not surprising that businesses do everything they can to convince people to buy whatever they’re selling. But what happens when marketing becomes active manipulation? More precisely, what happens when companies use science and technology not only to refine our pleasures but to engineer addictive behaviors?”

“I’m not anti-capitalism, but I am calling attention to a certain species of capitalism that cultivates addictive behavior for profit.”

The strong economy is an opportunity for progressives

“Even as the labor market has gotten steadily healthier in recent years, the American birth rate continues to fall from its recession-era highs.

Women tell pollsters that’s not because the number of kids they’d ideally like to have has fallen. Instead, the No. 1 most-cited reason is the high cost of child care. Child care doesn’t get more affordable just because the unemployment rate is low. If anything, it’s the opposite — child care is extremely labor-intensive, and the prospects for introducing labor-saving technology into the mix look bad. To make child care broadly affordable would require government action; it’s just not going to happen in a free market, which doesn’t magically allocate extra income to people who have young kids.”

“America’s sky-high child poverty rate compared with peer countries is entirely attributable to our failure to enact a child allowance policy. A better labor market helps marginally, but it doesn’t address the fundamental issue that a new baby increases financial needs while also making it harder to work long hours.”