America's other 87 deficits

A multilateral deficit cannot be fixed by putting pressure on one of its bilateral components. But try telling that to America's growing chorus of China bashers.

America's massive trade deficit is a direct consequence of an unprecedented shortfall of domestic saving. The broadest and most meaningful measure of a country's saving capacity is what economists call the "net national saving rate" - the combined saving of individuals, businesses, and the government. It is measured in "net" terms to strip out the depreciation associated with aging or obsolescent capacity. It provides a measure of the saving that is available to fund expansion of a country's capital stock, and thus to sustain its economic growth.