[america-rules]

"If by trade deficit what is meant is that more goods are flowing in than are flowing out, this simply reflects the realities of a service economy"

OK, then why did we have a Trade Deficit during the 70's, 80's and 90's when we were making all those nuts and bolts etc. ?

[Asclepius]

OK, then why did we have a Trade Deficit during the 70's, 80's and 90's when we were making all those nuts and bolts etc. ?

Why indeed. We have been transitioning to a service-information based economy since the thirties, with heavier, dirtier, more human, material, and capital intensive enterprises leaving our shores since much earlier in the last century. Andrew Carnegie at the turn of the last century knew the steel industry was collapsing, and he diversified. The strength of our economy is its scale and diversity and flexibility and ability to adapt to changing conditions.