How The US Federal Deficit And Trade Balance Have Changed Since Trump Took Office

With the election now just one week away, Americans are weighing the two presidential candidates and choosing which one will be best for the country over the next four years.

One way they can do that is by looking back on the first term of President Donald Trump and reassessing the effectiveness of his policies.

Trade War

One of the centerpieces of Trump’s first term in office has been his trade war with China. He has repeatedly cited the U.S. trade deficit with China as grounds for the trade war.

Related Link: How Trump's Stock Market Return Compares To Obama, Bush And Other Past Presidents
Unfortunately for Trump and other Americans, the latest data from the Commerce Department indicates the U.S. trade deficit is now at its highest level since 2006.

The Commerce Department reported the August U.S. trade deficit was $67.1 billion, up from $63.3 billion in July. Through the first eight months of 2020, the US has recorded a trade gap of $421.8 billion, up 5.7% from the same period in 2019. The total U.S. trade deficit for 2019 was $576.9 billion, down 0.5% compared to 2018.

At the same time, through the first nine months of 2020, China has reported a trade surplus with the US of $218.5 billion. The US trade deficit with China was $345.2 billion in 2019, down 18% compared to 2018.

The U.S. trade deficit with China is by far the largest of any U.S. trading partner.

As the recent numbers suggest, Trump’s trade war tariffs seems to be having little impact on the overall trade deficit. The 10-year chart below highlights the increase in the US trade deficit during the Trump administration:

National Deficit

Another area Trump pledged to improve during the 2016 campaign was the US federal deficit. In fact, Trump said he could eliminate the deficit entirely in just eight years in office.

During President Barack Obama’s final year in office in 2016, the US deficit was $585 billion. Here’s a look at how it has changed under Trump:

  • 2017: $665 billion
  • 2018: $779 billion
  • 2019: $984 billion
  • 2020: $3.7 trillion

Prior to the COVID-19 outbreak, the deficit under Trump was already up about 68% in his first three years in office. Thanks to the pandemic, Trump’s 2020 deficit alone will be more than six times the 2016 deficit he inherited from Obama.

Benzinga’s Take

The good news for US investors is that US stocks have performed relatively well during the Trump presidency. The SPDR S&P 500 ETF Trust SPY is up 53.9% since Election Day 2016, while the iShares China Large-Cap ETF FXI is up just 17% in that time.

Posted In: 2020 presidential electionBarack ObamaChinaDonald Trumpelection dayGeorge BushPresident Donald TrumpGovernmentRegulationsEducationPoliticsTop StoriesEconomicsGeneral

Ad Disclosure: The rate information is obtained by Bankrate from the listed institutions. Bankrate cannot guaranty the accuracy or availability of any rates shown above. Institutions may have different rates on their own websites than those posted on Bankrate.com. The listings that appear on this page are from companies from which this website receives compensation, which may impact how, where, and in what order products appear. This table does not include all companies or all available products.

All rates are subject to change without notice and may vary depending on location. These quotes are from banks, thrifts, and credit unions, some of whom have paid for a link to their own Web site where you can find additional information. Those with a paid link are our Advertisers. Those without a paid link are listings we obtain to improve the consumer shopping experience and are not Advertisers. To receive the Bankrate.com rate from an Advertiser, please identify yourself as a Bankrate customer. Bank and thrift deposits are insured by the Federal Deposit Insurance Corp. Credit union deposits are insured by the National Credit Union Administration.

Consumer Satisfaction: Bankrate attempts to verify the accuracy and availability of its Advertisers' terms through its quality assurance process and requires Advertisers to agree to our Terms and Conditions and to adhere to our Quality Control Program. If you believe that you have received an inaccurate quote or are otherwise not satisfied with the services provided to you by the institution you choose, please click here.

Rate collection and criteria: Click here for more information on rate collection and criteria.