GARY | The clock literally is ticking on the U.S. trade deficit, and each second puts the country farther behind in the world economic community, as an Indiana University Northwest professor illustrated Tuesday.
During the 40 minutes marketing professor Subir Bandyopadhyay discussed the problem of the mounting U.S. trade deficit and offered some solutions, the Trade Deficit Clock in his power point presentation showed another $58 million in lost trade opportunities.
“The balance of trade is between exports and imports. When a country is exporting more than it is importing, there is a trade surplus. We import more than we export,” said Bandyopadhyay in his talk for students, faculty and the community.
In January 2010, President Obama pledged to double U.S. exports from $1 trillion to $2 trillion within five years, he said. While the U.S. is moving in some ways toward that goal, all the increases so far are “in the negative,” the professor said. “We have uncontrolled growth in the trade deficit.”
In 2011, the U.S. trade deficit was $560 billion. Today it’s in the trillions of dollars. Currently, 32 percent of American exports are in services where there is a trade surplus, he said, “but export of goods runs up a huge deficit.”
Although it’s a broad topic, “it affects all of us” because exports translate into jobs, increased wages and continued success of companies, said Bandyopadhyay, winner of the 2012 Executive Vice Chancellor of Academic Affairs Distinguished Research/Creative Activity Award.
“The bigger issue is that if we can move in the right direction, we can stop that movement (into the negative),” he said.
Focusing U.S. exports on specific countries and their consumers is one major solution, because increased exports lead to a better balance of trade, he said.
Specific trade agreements between the U.S. and specific geographic areas will also help, Bandyopadhyay said. Tariffs or fees placed on specific goods such as steel have resulted in animosity. Non-tariff solutions include setting standards that only a country’s companies can achieve create affinity for America and its industries, he said.
“On the positive side, it (Indiana exports) is growing,” he said. “The top markets for Indiana are Canada, Mexico, Germany, Japan, France and China. We have not tapped yet into emerging markets.”