What the Trade Deficit Is and Why an Ongoing Trade Deficit Weakens the Economy

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http://useconomy.about.com/od/tradepolicy/p/Trade_Deficit.htm

What the Trade Deficit Is:

The U.S. trade deficit is when the total goods and services the U.S. imports is greater than the total it exports. In 2011, the total U.S. trade deficit was $559.956 billion. This was $2.1 trillion in exports minus $2.67 trillion in imports. This shows the economy is strengthening, since it is more than the $500 billion trade deficit in 2010. Still, it's much less than the record $753 billion trade deficit in 2006. (Source: U.S. Census, Most Recent Annual Trade Data. For more recent monthly data, see U.S. Trade)
Petroleum Imports Drive the Trade Deficit:

America's dependence on foreign oil drives the trade deficit. In 2011, the U.S. imported $332 billion in petroleum-related products, compared to $252 billion in 2010. The number of barrels imported was slightly lower, but oil prices jumped from an average of $99.78/barrel to $74.67/barrel. Petroleum-related products include crude oil, natural gas, fuel oil and other petroleum-based distillates such as kerosene. (Source: U.S. Census, U.S. Oil Imports)

Consumer Products and Autos Contribute to the Deficit:

Another large contributor to the trade deficit is consumer products, such as Drugs, Consumer Electronics, Clothing, Household Goods, and Furniture. In 2011, the U.S. ran a $326 billion deficit in consumer products, importing $483 billion while only exporting $157 billion. This was also up from prior years, despite a relatively weak dollar and resultant mild inflation.

Why an Ongoing Trade Deficit Weakens the Economy:

An ongoing trade deficit is detrimental to the nation’s economy over the long term because it is financed with debt. In other words, the U.S. can buy more than it makes because the countries that it buys from are lending it the money. It's like a party where you've run out of money, but the pizza place is willing to keep sending you pizzas and put it on your tab. Of course, this can only go on as long as there are no other customers for the pizza, and the pizza place can afford to loan you the money. One day the lending countries may decide to ask the U.S. to repay the debt. On that day, the party is over.

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I have posted this here before and it never got much attention. Not sure why though. Maybe it isn't what people want to hear?