Arthur F. Burns

In recent years, the strong American recovery in overall production and employment has been accompanied by further deterioration in the merchandise trade of the United States with other countries. The reasons for focusing on American merchandise trade are not merely parochial; it is important for Europeans and others to understand that this poor trade performance of the United States reflects a disequilibrium in the world economy as well as in the American domestic economy. Political strains in many countries have been the inevitable result. The promises made at last year's Williamsburg Summit with regard to international trade and finance have not been fulfilled. If anything, international tensions arising from economic issues have increased during the past year.