It is a study in contrasts: In February, the U.S. posted an all-time record $61 billion foreign trade deficit, representing almost 6 percent of the country's gross domestic product — and a steep increase over 4.8 percent of GDP just a year ago.

Yet, while the U.S. was heaping its shopping basket ever fuller of imported goods, the media virtually ignored the fact that the country posted a $577 million agricultural trade surplus in the same month.

Granted, $577 million isn't a whale of a large number in terms of the $4.5 billion we spent on ag imports — but it's a heckuva lot better than a $61 billion overall trade deficit, and it was $2.3 billion ahead of the same period in 2004, reflecting strong overseas demand for U.S. farm products.

The glass-is-half-full philosophizers say the whopping U.S. trade imbalance is just an exercise in accounting, and besides, American consumers are the beneficiaries: they're getting more goods for less money, thanks to cheap labor in China, Korea, Taiwan, Central America and elsewhere. It's just the free market at work, they say.

Immaterial that China and some other countries have kept the U.S. dollar artificially high against their currencies so they can sell us more goods than they could without such manipulation. Some analysts say the undervaluing of the Chinese yuan is responsible for fully 25 percent of the U.S. trade deficit.

Treasury Secretary John Snow, parroting the administration's “What, me worry?” approach to fiscal policy, said in a recent talk, “I believe the first and most important part of an international economic policy is good policy at home, and here we have been successful.”

That “success” consists of a current fiscal year budget deficit that's within spittin' distance of last year's record $412 billion, and which doesn't even include the $80 billion or more in emergency spending on the Iraq/Afghanistan wars, or the additional red ink that will flow if the administration continues to insist on further tax cuts.

At last week's Washington meetings of the World Bank and International Monetary Fund, world financial leaders publicly and privately worried that a continued decline in the U.S. dollar and a worsening of the U.S. trade balance could result in global financial turmoil.

The more imports purchased by Americans, the more dollars end up as U.S. Treasury bond holdings by foreign countries, and the more potential for them to dump those bonds if they feel this country's debt load is too onerous. The IMF now projects that by 2010, the net indebtedness of the U.S. will reach 50 percent of GDP — almost double the current level.

Over the past 20 years, the rising trade deficit has wiped out millions of jobs in the U.S., forcing workers, in most cases, to accept lower-paying jobs and a reduced standard of living.

While agriculture's positive trade balance continues to be the small bright spot in the gloom and murk of deficits, there are those who would be only too happy to see farming, too, moved offshore.

Heaven help us when this country's food supply is subject to the whim of foreign interests, as is the case with oil.


e-mail: hbrandon@primediabusiness.com