In 2015 the USA ran a $746 billion trade deficit in goods, seven times the 1992 level. In those 23 years, the deficit has gone from 1.5% of our GDP to 4.2%. Our overall goods deficit is driven by a handful of countries. America’s bilateral trade deficits with China, Germany, Japan, Mexico, Vietnam, Ireland, South Korea, and Italy totaled $682 billion last year, equivalent to nearly 91% of our global deficit.
There is little correlation between trade agreements and improved US trade performance. The US has bilateral or multilateral trade agreements with all top deficit countries. However different industries give rise to those imbalances depending upon the country. Many of these countries have export-oriented growth strategies in that they overproduce, underconsume, and thus rely upon the US market for growth rather than sufficiently increasing internal consumption.