Friday, February 11, 2005

Trade deficit soars to $618 billion

New high in 2004, up 24 percent from 2003, is pushed by higher oil prices.

By Martin Crutsinger / Associated Press

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WASHINGTON -- The U.S. trade deficit ballooned to an all-time high of $617.7 billion last year, pushed by soaring oil prices and Americans' insatiable appetite for everything foreign, from cars to toys and food.

The Commerce Department reported Thursday that the 2004 imbalance rose 24.4 percent from the previous year and marked the third year in a row that the deficit had set a record. The imbalance with China swelled by 30.5 percent to $162 billion, the highest ever with any country.

For December, the deficit actually shrank. But at $56.4 billion, it still was the second worst monthly showing ever.

Democrats said the figures were evidence that President Bush's policy of seeking trade deals was failing. They said the 2.7 million manufacturing jobs the United States has lost over the past four years reflect in large part unfair trading practices by China and other countries. Sen. Byron Dorgan, D-N.D., said the report was "devastating news for the American economy."

House Democratic leader Nancy Pelosi of California said the deficits were undermining the U.S. manufacturing base.

Added John Sweeney, the AFL-CIO's president: "America is losing good jobs due to bad trade deals."

The demand for foreign goods was led by a 35.7 percent surge in foreign petroleum imports, which climbed to a record $180.7 billion.