Job-Killing Trade Deficits Surge under FTAs: U.S. Trade Deficits Grow 462% with FTA Countries, but Decline 7% with Non-FTA Countries
The aggregate U.S. goods trade deficit with Free Trade Agreement (FTA) partners is more than five times as high as before the deals went into effect, while the aggregate trade deficit with non-FTA countries has actually fallen. The key differences are soaring imports into the United States from FTA partners and lower growth in U.S. exports to those nations than to non-FTA nations. Growth of U.S. exports to FTA partners has been 21 percent lower than U.S. export growth to the rest of the world over the fifteen years (annual average growth of 2.7 percent to non-FTA nations vs. 2.1 percent to FTA nations).
The aggregate U.S. trade deficit with FTA partners has increased by about $159.2 billion, or 462 percent, since the FTAs were implemented. In contrast, the aggregate trade deficit with all non-FTA nations has decreased by about $58.2 billion, or 7 percent, since 2005 (the year before the median entry date of existing FTAs). Using the Commerce Department’s exports-to-jobs ratio and counting imports and exports, the FTA trade deficit surge implies the loss of over 840,000 U.S. jobs. The North American Free Trade Agreement contributed the most to the widening FTA deficit – under NAFTA, the U.S. trade deficit with Canada ballooned and our surplus with Mexico has turned into a more than $115 billion deficit. More recent deals have produced similar results. Under the 2012 Korea FTA the U.S. trade deficit with Korea has surged 102 percent.