Who’s Killin’ Who?

“Mexico is killing U.S. on trade,”

“They’re killing us at the border and they’re killing us on jobs and trade. FIGHT!”

~ D. Trump

Here’s the data:

mex trade

Looks like a 500% plus increase in total trade, a merchandise trade deficit of around $50 billion and US merchandise exports of around $240 billion.

There is also a $10 – 15 billion US trade surplus in services to consider.

For context, The US merchandise trade deficit with China was $343 billion in 2014 and US exports to China were $123.6 billion.

The US exports twice as much to Mexico as it does to China and its merchandise trade deficit with Mexico is around 6.5 times smaller than its deficit with China.

It is also true that a lot of US trade with Mexico come from an international production process as can be seen below:

Untitled 2

The US imports Motor Vehicles and their parts, oil and gas, computer equipment and audio-visual equipment from Mexico while it exports Motor Vehicle parts, Petroleum products computer equipment and electronic components to Mexico.

****Let us pause for a moment of silence to remember the late, lamented Heckscher-Ohlin theory of trade******

It would be far more accurate to say that US drug laws are killing Mexico than to say that any or everything that Mexico may be doing is hurting the US.