Trade Deficits – Bad?

The nearly permanent US trade deficit is getting a lot of attention. Surely, it’s a bad thing to send so much money outside the US when it could be providing jobs to American workers, yes? The problem largely goes without saying, and is never actually discussed.

But are trade deficits really that bad? As with most things in economics, the short answer is no but the long answer is yes. Let’s discuss.

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