America’s massive trade deficit is the biggest factor contributing to the nation’s high and persistent unemployment rate, according to University of Maryland economist Pete Morici.

Writing in the United Press International, Morici says that America’s trade gap in the second quarter alone shaved 2.8 percent off economic growth. That 2.8 added to the 2.8 percent growth on top of the 2.4 percent recorded would have put the economy on pace to create enough jobs to knock the unemployment rate below five percent by 2013.

If nothing is done to remedy the problem, America could be looking at a national unemployment rate permanently hovering at around 10 percent, he said.

“Oil and consumer goods from China account for nearly the entire trade deficit and without a dramatic change in energy and trade policies, the U.S. economy faces unemployment around 10 percent indefinitely,” Morici writes.

America’s failed trade policies are responsible for the out-of-control trade deficit. Instead of practicing true free trade, America has become a consumer looking for the cheapest deal.

“Countries increase foreign purchases in industries where they are relatively less productive and specialize in what they do best,” Morici writes. “The United States is doing too much buying but not enough selling.”

And while the president’ plan to double the nation’s exports in the next five years sounds good in theory, it will be all for naught if the nation’s imports double as well. Instead, American policymakers need to focus on combating the mercantilist practices of China, India and America’s other trading partners. Otherwise, those nations will continue to game the system and put American workers in an extremely uncompetitive situation.

“China recognizes Obama isn’t likely to counter Chinese mercantilism with strong, effective actions; hence, it offers token gestures and cultivates political support among U.S. businesses like General Motors profiting from investments in China,” he writes.

Instead, the administration is focused on passing a trio of free trade agreements negotiated under the Bush administration, including a trade pact with South Korea, which would represent America’s largest free trade agreement since the North American Free Trade Agreement.

Using past trade agreements as a model, the Economic Policy Institute projects that trade agreements with South Korea and Columbia would be very costly to the American economy. According to the study, the nation would lose 214,000 jobs by 2015, mostly well-paying manufacturing jobs. The trade deficit would rise by $16.8 billion, the study projects.

That would only serve to add to the nation’s employment woes and ensure that the national unemployment rate remained historically high.

“Doubling exports does no good if imports double, too,” Morici writes. “By increasing the trade gap, more open trade policies would increase the drag on growth and jobs creation.”

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