As a candidate, Donald Trump promised “brilliant trade” policies that would drop the national trade deficit “like you’ve never seen before.”
Two years after he was elected, despite his singular focus on trade, America is importing more goods, while exporting less, than it ever has.
The federal government announced Thursday that America’s trade deficit hit $55.5 billion in October, rising almost a billion dollars from September. This is a ten-year high.
Rising imports for goods were the main driver. America’s global seasonally-adjusted trade deficit in goods hit $76.9 billion in October, the highest it’s ever been. It was $66.5 billion in January 2017. The trade surplus in services decreased by $0.1 billion from September to October, to $22.6 billion, which, combined with the deficit in goods, brings the total trade deficit to $55.5 billion.
These are not the numbers Trump had in mind when he was interviewing for the job.
Candidate Trump promised a massive drop in the nation’s trade deficit. “The trade deficit was only $84 billion when Bill Clinton was first inaugurated. So, we’ve taken from $84 billion, which is a lot of money, to now $800 billion,” he told a crowd in Manchester, New Hampshire in June 2016. “And going up, going fast unless I become president. You will see a drop like you’ve never seen before. You have never seen before.”
He promised he would negotiate, “fair trade, smart trade, I even like to say brilliant trade.”
China is America’s biggest trading partner. America’s trade deficit with China hit $43.1 billion in October, which is far higher than it’s ever been. The first time that number hit $40 billion was in September. Trump identified trade with China as the biggest priority for his trade policy during the campaign and as president. He promised he could shrink the trade deficit with China.
“In China, think of this, we have a trade imbalance of almost $400 billion a year,” Trump told a crowd in 2015. “Can you imagine if we could straighten it out? Could you imagine if I could get that down to, and I promise I’ll do better than this, but could you imagine if I could get it down to $100 billion a year in losses?”
In 2016, America’s trade deficit with China was $347 billion; in 2017, it was $376 billion. Through the first ten months of 2018, it was $344.5 billion — each month so far this year the trade deficit has been hundreds of millions or billions higher than it was.
The stock market, which has risen since Trump was elected, has not been reacting well to the drama surrounding the president’s supposed trade deal with China. The Dow and S&P 500 are having their worst quarter in seven years, and have eliminated all gains from the year.