America’s trade imbalance with China is continuing to worsen,
according to statistics released in February by the Foreign Trade
Division of the U.S. Census Bureau.
In 2007, the trade deficit with China (exports minus imports) passed
the quarter trillion dollar mark: $256.3 billion. U.S. imports from
China set a new record: $321.5 billion. That’s the equivalent
of $1,068 of Chinese goods for every man, woman and child in America,
though even that figure is a way-below-wholesale price; it’s
what U.S. companies paid to Chinese enterprises. Meanwhile, U.S.
exports to China also rose, to an estimated $65.2 billion, though
it consisted mostly of raw materials, parts and machines.
Overall the U.S. trade deficit with all its trading partners was
down slightly, to $711.6 billion in 2007, from $758.5 billion in
2006. That owes to lowered consumer spending and a decline in the
value of the dollar.
But China trade continues to zoom. The United States now imports
more from China than from any other country. It’s not like
Chinese brands are filling American shelves. For the most part,
imports are a case of U.S. companies choosing China as the location
to produce manufactured goods. Production that used to be outsourced
to other less-developed countries is coming to be concentrated in
China.
The imbalance is alarming to leaders of the American labor movement,
which at one time was strongest in manufacturing.
“Our imbalance with China is unsustainable,” said AFL-CIO
President John Sweeney in a press statement reacting to the release
of the annual trade statistics. “Our government must take
immediate and effective actions to ensure that the Chinese government
plays by the rules – with respect to currency, illegal subsidies,
tax policies and workers’ rights.”
The labor federation is backing a bill in Congress, the Currency
Reform for Fair Trade Act (HR 2492), which declares currency manipulation
an illegal trade subsidy and provides American manufacturers the
opportunity to seek relief against countries that don’t freely
exchange their currency, including China.
China is so dominant in the consumer goods sector that it calls
into question the recent stimulus package passed by Congress. To
combat the recession, the IRS will be mailing out checks to Americans
in the coming months, and the hope is they’ll go shopping.
But if they’re spent on clothes, toys or electronic goods,
those dollars likely won’t employ American workers other than
those whose jobs are to transport or sell the goods.
