Table 1

Impact of ending currency manipulation, on U.S. economy and state spending, 2015*

Scenario**
Change in 2015 Low impact High impact
Trade deficit (billions of dollars) -$200 -$500
Gross domestic product
in annual billions of dollars +$288 +$720
as a share of GDP*** +2.0% +4.9%
Number of jobs +2,300,000 +5,800,000
Federal budget deficit
in annual billions of dollars -$107 -$266
as a share of federal deficit*** -34.4% -86.1%
State and local budget funds
in annual billions of dollars +$40 +$101
as a share of state spending*** +2.0% +4.9%
as a share of state/local deficits*** -27.4% -68.4%

*The table estimates the effects of ending currency manipulation over three years, modeled as having begun in 2013.

**The low-impact scenario assumes ending currency manipulation would reduce the trade deficit by $200 billion in 2015 relative to the trade deficit in 2012; the high-impact scenario assumes a $500 billion reduction in the trade deficit.

***Percentages shown are relative to baseline forecasts for 2015.

Note: Dollar calculations are in 2005 dollars.

Source: Author's analysis of Bergsten and Gagnon (2012), the American Community Survey (U.S. Census Bureau 2013), U.S. International Trade Commission (2013),  Congressional Budget Office (2013a and 2013b), Bivens (2011), Bivens and Edwards (2010), Kondo and Svec (2009, 10), Bureau of Labor Statistics (2013d), Bureau of Labor Statistics Employment Projections program (BLS-EP 2011a and 2011b), and Zandi (2011). For a more detailed explanation of data sources and computations, see text and the appendix.

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