The U.S. ran a trade deficit in advanced technology products of $200 billion in 2010.
As trade deficits have exploded and millions of manufacturing jobs moved overseas and were replaced by often lower-paying service jobs, Americans have taken solace in the idea that we were simply moving up the value chain and making more sophisticated products. Making these products required more advanced skill and these jobs paid well. The deficit in advanced technology products, however, serves as a reminder that we are at risk of ceding more than merely T-shirt making as we allow our manufacturing sector to shrink. The deficit in advanced technology also reminds us that foreign competition for high-end manufacturing is intense, and not always pursued in compliance with global trade rules. If we are to fully recover from the recession and build a better future, we need to invest in our manufacturers and workers and design trade and tax policies to bolster innovation-based competitiveness.