So what % of GDP is the trade deficit at now?

[mnmoderatedem]

Remember the bushbots repeatedly told us that the continually rising trade defecit is no big deal, because it's only 1.5% of GDP, or 2% of GDP, etc. I'd have to think it's much more than that now.

Anyone have the current numbers?

[phusion]

1. If I did this right it's at 5.7%

Current trade deficit (http://news.yahoo.com/s/ap/20060211/ap_on_bi_go_ec_fi/economy): $725 billion
Fourth quarter '05 GDP (http://www.bea.gov/bea/newsrel/gdpnewsrelease.htm): $12,735 billion

725/12735 ~ .0569

[Sammy Pepys]

2. Yup.

I think that's right.

[ProfessorGAC]

3. You Did It Right

Thing is, it hasn't been 1.5% or 2% for many years, so i don't know where they got that number in the first place. It was over 4% in Reagan's first time, IIRC. (I'd have to go back and look at my old files to be sure.) That was 20+ years ago. I flattened out for a while, especially during Clinton, but that was because the real GDP growth was greater than the growth in trade deficit. So, it went down a pinch, but statistically it was flat.

So, this 2% or less thing is silly, because it's been years since it was that low.
The Professor

[phusion]

4. Here's a nice graph from Wikipedia

[ProfessorGAC]

5. I Have Serious Doubts About The Integrity Of These Data

Remember that conventional economists redact things all the time when they're inconvenient to the analysis. They aren't statistical experts who work with econometric data. They are economists with a passing knowledge of mathematics, for the most part.

That 1991 number seems very hard to believe, since we were buying such huge quantities of imported oil in 1991. And, since the european currencies (mostly Italy, Spain, Greece, and the newly liberated eastern bloc countries) as well as the yen were weak, there weren't that many U.S. goods being purchased from overseas. The dollar was too strong vs. the native currencies and the goods weren't flowing. I wonder if these numbers redact the crude oil, since energy dollars really seem to perplex the conventionalists.

The Professor