Trade Troubles Persist Despite Growth in September

By SBE Council at 9 November, 2023, 12:25 am

by Raymond J. Keating –

The latest international trade report from the U.S. Bureau of Economic Analysis showed some growth in exports and imports in September.

U.S. exports increased by 2.2 percent in September, registering $261.1 billion. That marked three consecutive months of growth (in nominal terms). However, the September level remained below where it was in August of last year, for example. Factor inflation in, and the decline of course worsens.

Meanwhile, after declining in August, U.S. imports increased in September, coming in at $322.7 billion. That was below where it was a year earlier, and below the recent high of $348.2 billion registered in March 2022.

Through the first nine months of 2023, total exports ($2.28 trillion) ran slightly ahead of where they stood over the first nine months of 2022 ($2.26 trillion). However, once inflation is factored in, again, real exports declined.

The story on imports – which reflects the state of the domestic economy – was even worse, as total imports through the first nine months of 2023 ($2.87 trillion) were down in nominal terms versus the first nine months of 2022 ($3.0 trillion).

U.S. Global Leadership Needed

The U.S. desperately needs to reclaim its global leadership on reducing barriers to trade, and thereby advancing economic growth at home and among our trading partners. Unfortunately, President Biden not only has kept the worst aspects of his predecessor’s protectionist trade measures in place, but actually has made them worse through expanded industrial policy (where politicians and government bureaucrats pick winners and losers), and working to supplant free trade agreements with efforts to impose regulations internationally.

That, of course, is a recipe for less trade; fewer opportunities for U.S. entrepreneurs, businesses and workers; increased costs for U.S. businesses and consumers; and slower growth.

Raymond J. Keating is chief economist for the Small Business & Entrepreneurship Council. His latest books on the economy are The Weekly Economist: 52 Quick Reads to Help You Think Like an Economist and The Weekly Economist II: 52 More Quick Reads to Help You Think Like an Economist.