• The Heritage Network
    • Resize:
    • A
    • A
    • A
  • Donate
  • Good News on Trade: Exports and Imports Are Up

    The U.S. Bureau of Economic Analysis today announced that U.S. exports for January were $4.4 billion higher than in December. This is good news for U.S. exporters.

    The bureau also reported that Americans imported $10.5 billion more in January than in December. This is good news, too.

    As President Obama’s Council of Economic Advisers recently reported, economic growth in other countries leads to increased U.S. exports. When people in other countries escape poverty and become richer, more of them are able to afford U.S.-made products.

    Just as economic growth in other countries enables more people to afford U.S. exports, economic growth in the United States enables Americans to spend more on imports.

    Misperceptions about the actual impact of international trade flows abound. For example, the Associated Press today “reported” that “a widening trade deficit hurts the U.S. economy. When imports outpace exports, more jobs go to foreign workers than to U.S. workers.”

    Apparently the AP slept through 2009, when the U.S. trade deficit shrank by 46 percent and the unemployment rate increased by 60 percent. In fact, there is nothing in either economic theory or the data to justify the AP’s wildly inaccurate assertion.

    Americans benefit from economic growth in other countries, which increases exports. We also benefit from economic growth in the United States, which increases imports. The best way to achieve both of these desired results is to encourage economic freedom both here and abroad.

    Posted in Economics [slideshow_deploy]

    One Response to Good News on Trade: Exports and Imports Are Up

    1. D R, DC says:

      I love this logic.

      In 2009, current tax receipts fell more than 13 percent and the unemployment rate increased by 60 percent.

      So should we celebrate higher taxes as well?

      Yes, the article is simplistic. But so long as net exports are negative (trade deficit) there must also be some combination of relatively low private savings and government budget deficit. Perhaps someone can make an argument that the additional imports increase economic growth to sufficiently offset the drag of lower national savings, but the fact of the low national savings will still remain.

    Comments are subject to approval and moderation. We remind everyone that The Heritage Foundation promotes a civil society where ideas and debate flourish. Please be respectful of each other and the subjects of any criticism. While we may not always agree on policy, we should all agree that being appropriately informed is everyone's intention visiting this site. Profanity, lewdness, personal attacks, and other forms of incivility will not be tolerated. Please keep your thoughts brief and avoid ALL CAPS. While we respect your first amendment rights, we are obligated to our readers to maintain these standards. Thanks for joining the conversation.

    Big Government Is NOT the Answer

    Your tax dollars are being spent on programs that we really don't need.

    I Agree I Disagree ×

    Get Heritage In Your Inbox — FREE!

    Heritage Foundation e-mails keep you updated on the ongoing policy battles in Washington and around the country.

    ×