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Chapter : Trade Policy
If the nation enjoyed general economic well-being during the eight years Ronald Reagan lived in the White House, one segment of the economy began showing symptoms of serious illness.
By Reagan's second term, a deepening trade deficit was threatening both the continued economic vibrancy of the United States and its strategic power. What had been the world's largest creditor nation slipped into debtor status, as foreigners bought more U.S. assets than U.S. citizens owned abroad. Before Reagan's term was up the United States was the world's largest debtor nation — at least by some measures.
All this was neither well understood nor significantly altered before Reagan left office, although there were attempts in Congress and in the administration to correct the trade imbalances.
Administration partisans largely ...