The Commerce Department yesterday published a special analysis of what it called "the basic" U.S. trade position purporting to show a situation "much more pessimistic" than portrayed by Treasury Secretary W. Michael Blumenthal.
A staff report by the department's Bureau of Internal Economic Policy and Research said that Treasury calculations showing the U.S. trade accounts would be in surplus, if it were not for a big oil deficit, are misleading.
"The use of a 'non-oil' trade balance as a measure of the underlying U.S. trade positions presents a much more optimistic picture than is actually the case," the report said.
The Commerce report carefully omits direct references to the Treasury. It also carries a boxed disclaimer on the cover saying its "should not be contrued as a statement of Department of Commerce policy."
But the report clearly carries forward Assistant Commerce Secretary Frank Well's assertion in public speeches in June and July that the trade deficit is more serious than the Treasury is willing to admit.
The main figure in contention are these: the official estimate of this year's trade deficit is about $15 billion. But the cost of oil imports is estimated at around $40 billion for 1977.
Thus, Treasury officials have pointed out, if it weren't for the big oil deficit, the U.S. would enjoy a surplus of $15 billion or a little more. But this, said the Commerce report, "is not meaningful," particularly because it fails to take into account that the higher payments to the oil exporting countries have enabled them to increase their purchases of goods from here.
More meaningful, but admittedly not perfect, says Commerce, are two different measures. One takes the U.S. balance of trade, and completely eliminates transactions with the Organization of Petroluem Exporting Countries. This measure shows a deficit of $4.5 billion with the rest of the world.
The second alternate suggested by commerce is a "non-oil non-OPEC" trade balance, which deducts all U.S. oil imports from all sources (not merely from OPEC), and deducts all U.S. exports to OPEC from total expoets. This shows a trade balance of only $4 billion.
In sum, what the Commerce report implies is that deducting the cost of oil, imports to yield a trade surplus is asimplistic measure.