The counterargument hinges on the difference between the current account deficit and the trade deficit. The current account deficit is equal to the trade deficit plus the cost of servicing the net international asset position the net rent, interest, and dividends owed to foreigners who have invested their capital in the US.

Palestinian net imports from Israel represent two thirds of the total trade deficit.

In short, substantial RMB appreciation would reduce the bilateral US China trade deficit and China s overall trade surplus significantly, but it would do little to reduce the overall US trade deficit. In the absence of a generalized appreciation of all Asian currencies and unchanged American policies, possibly only a deep recession could reduce the overall US current account deficit.

In 2003, the Territory finished with a slight trade deficit in the amount of 375,000.27

The opposite side of the high absorption GDP ratio is an equally high trade deficit.

Its exchange rate regime, which pegs the Renminbi to the US dollar, was blamed for the mounting US trade deficit. Never mind that America's bilateral trade deficit with China, even including Hong Kong, accounts for less than one fifth of the total US deficit growing imports from China and more direct investment by US companies supposedly fueled US unemployment.

Indeed, America s trade deficit in manufactures is roughly equal to its current account deficit (the amount by which domestic investment exceeds domestic saving). So those concerned with job losses in US manufacturing should join the chorus lobbying for a much smaller fiscal deficit.

While it runs a large trade deficit with China, it also runs deficits with 87 other countries. A multilateral deficit cannot be fixed by putting pressure on one of its bilateral components.

On trade, Romney promises to launch a trade war with China, and to declare it a currency manipulator on Day One a promise that gives him little wiggle room. He refuses to note the renminbi s large real appreciation in recent years, or to acknowledge that, while changes in China s exchange rate may affect the bilateral trade deficit, what matters is America s multilateral trade deficit.

Most economists go a step further, asserting that the US deficit is caused by a savings shortage. But, since one country s trade deficit is another s surplus, US Federal Reserve Chairman Ben Bernanke has argued for turning the conventional logic on its head rather than resulting from a savings shortage, the US trade deficit is the result of a global savings glut especially in China.

Despite the many sacrifices we are making, our economies continue to be marginalized, and our trade balances are increasingly in deficit.

Without fundamental changes in its economic growth pattern, it is difficult to imagine how China can become an immature creditor lender and a mature creditor lender. A more likely scenario is that China will continue to have a trade surplus (though much smaller) and an investment income deficit, mirrored by America s trade deficit and investment income surplus.

The Roman Empire ran a persistent trade deficit with India for centuries. Although the resulting outflow of gold caused monetary debasement in the Roman Empire, Indo Roman trade remained the backbone of the global economy.

So, how should the US economy s jobs deficit, investment deficit, and long run fiscal deficit be addressed?

There is both a knowledge deficit and an understanding deficit.

In Portugal, by contrast, the trade deficit amounted to only about one third of exports in 2008, meaning that exports had to increase by one third to close the external deficit, without reducing imports. Since then, Portugal has increased exports cumulatively by more than one quarter, so that, despite a slight increase in imports since 2007, it runs a trade surplus.

Two decades ago, the US pressed the Japanese to allow the yen to strengthen against the dollar, claiming that Japan s unfair exchange rate policies were responsible for America s ballooning bilateral trade deficit. Likewise, today s China bashing in the US which has intensified as China s contribution to America s trade deficit has soared is intended to force the Chinese authorities to allow faster renminbi appreciation.

Nonetheless, the Territory generally runs at a trade deficit, owing to its heavy reliance on imported goods, most of which come from the United States mainland.

Growth momentum has fizzled and, with inflation persistently high, Indian producers are struggling to compete in world markets. The current account deficit is increasing relentlessly, owing to a widening trade deficit (now at 13 of GDP), raising the danger of a balance of payments crisis.

Both countries have massive surpluses of savings over investment and huge trade surpluses. Both parade their fiscal virtue and insist that deficit countries stop their irresponsible spending.

Without fixing its savings problem, restricting trade with a few so called currency manipulators would simply redistribute the US trade deficit to its other trading partners. In effect, America s trade balance is like a water balloon applying pressure on one spot would simply cause the water to slosh elsewhere.

Yes, the US runs a massive trade deficit with China around 295 billion in 2011, or fully 40 of America s total merchandise trade gap of 738 billion. Republicans and Democrats alike argue that this is the crux of America s jobs problem.

If one looks at multilateral trade imbalances, the US stands head and shoulders above all others. In 2005, the US trade deficit was 805 billion, while the sum of the surpluses of Europe, Japan, and China was only 325 billion.

The logic of the liberal approach is that the economic benefits of trade arise from imports the cheaper the imports, the better, even if the result is a trade deficit. Mercantilists, however, view trade as a means of supporting domestic production and employment, and prefer to spur exports rather than imports.

In the last five years, the Palestinian trade deficit with Israel as a percentage of GDP ranged between 32 per cent in 2002 and 40 per cent in 2004.

These figures indicate that all the donor relief support received by the PA in the last four years was not enough to pay for the trade deficit with Israel.

Europe s Trust Deficit

Europe s Vision Deficit

The Energy Deficit

Huge tax cuts and rising military spending have fueled an enormous rise in imports, and therefore a yawning trade deficit now accompanies America s weak fiscal position. But US politicians are blaming China and other countries for unfair trade, even threatening them with sanctions.

BERKELEY The United States is beset by four deficits a fiscal deficit, a jobs deficit, a deficit in public investment, and an opportunity deficit. The budget proposals put forward by presidential candidate Mitt Romney and his running mate, Paul Ryan, could reduce the fiscal deficit, but would exacerbate the other three.

But none of these is the deficit that really matters. The deficit that prevents Europe from drawing a line under its crisis is a deficit of trust.

Romney has provided few details about his deficit reduction plan. But, based on what he has revealed, we know that it would increase the jobs deficit, the investment deficit, and the opportunity deficit, with negative consequences for future growth and prosperity.

Moreover, an important advantage of fiscal devaluations is that they generate additional revenues in proportion to the country s trade deficit. For countries that are suffering from weak competitiveness and, as a consequence, running trade deficits, this typically means more revenues, especially in the short run.

It perpetuates deficit spending.

Europe s Pointless Deficit Targets?

America s Misplaced Deficit Complacency

Global Warming s Technology Deficit

Closing America s Jobs Deficit

The Global Trust Deficit

That would have put a partial brake on growth in asset prices, raised savings, reduced investment, and probably lowered the trade deficit. But the automatic stabilizers that normally kick in did not.

China breaks Crowther s mold. Given that it has been running an investment income deficit, a trade surplus, and current account surplus, it seems that it should be classified as a debtor repayer.

In that vein, closing down trade with China, while failing to address the saving shortfall, is like putting pressure on one end of a water balloon. The Chinese component of America s multilateral trade deficit will simply migrate somewhere else most likely to a higher cost producer.

On the eve of the last G 7 meeting in London, US Federal Reserve Chairman Alan Greenspan did a startling about face by soft pedaling America s trade deficit. Market pressures appear poised to stabilize and over the longer run possibly to decrease the US current account deficit and its attendant financing requirements, he said.

Attention deficit disorder, bipolar disorder.