O'Reilly confused on elementary economicsJune 15, 2004 11:26 AM EDT ››› GABE WILDAU
Radio and TV host Bill O'Reilly told a caller on his June 10 radio show, "We [the United States] have a trade deficit with everybody, because everybody wants our stuff, and we're not wild about snails" -- indicating that he doesn't know the definition of "trade deficit" and implying, incorrectly, that the United States runs a trade surplus with France. In fact, in the first four months of 2004, the United States had a $3.0 billion trade deficit with France.
Responding to a caller who suggested that the United States "cut off some of the aid" to certain allies in response to perceived insults -- most recently French President Jacques Chirac's decision not to attend the funeral of former President Ronald Reagan -- O'Reilly correctly explained that the United States doesn't give significant economic aid to these countries and that most economic exchange comes in the form of international trade.
From the June 10 broadcast of The Radio Factor with Bill O'Reilly:
O'REILLY: We [the United States] don't give them [allies like France, Russia, and Japan, whose heads of state declined to attend the Reagan funeral] much aid anymore, Marie. That's kind of a big misnomer. We don't -- we don't give them much aid anymore. It's a lot of loans and trade and all of that. We have a trade deficit with everybody, because everybody wants our stuff, and we're not that wild about snails. So it's always a trade imbalance.
In the field of economics, a nation is said to have a "trade deficit" with a particular country when the value of its imports from that country exceeds the value of its exports to that country. The United States does indeed have a trade deficit with many (though not all) countries, as O'Reilly claimed; but the reason is that other counties do not want (or cannot afford) as much of "our stuff" as we want (or can afford) of theirs. In 2003, the United States ran an overall trade deficit of $496.5 billion. [UPDATE: The Washington Post reported on June 15, "Not a month has gone by this year in which the U.S. trade deficit has failed to hit a new record -- and a government report issued yesterday [June 14] provided no exception, showing a $48.3 billion trade gap for April."]
Beyond his confusion about basic economic concepts, O'Reilly's remark that Americans are "not wild about snails" implies that he believes the United States runs a trade surplus (or a "trade deficit," as he would call it) with France. But the opposite is true. According to the U.S. Census Bureau, in 2003, the United States imported from France $12.2 billion more than it exported to that country. And, in the first four months of 2004, the United States had a $3.0 billion trade deficit with France.
O'Reilly does appear to be correct about America's small appetite for escargots; our largest imports from France include civilian aircraft, auto parts, pharmaceuticals, and artwork and collectibles. Of the $29.2 billion worth of French products that the United States imported in 2003, "meat products, poultry, and edible animals" totaled just $4.4 million -- significantly less than one* percent of the total.