While Americans celebrate the spectacular growth of the so-called new economy, one chronically troubling economic indicator threatens to spoil the party: the balance of payments. The country’s shift in the 1990s toward information-based, postindustrial businesses has been accompanied by a dramatic widening of its trade gap. The U.S. deficit this year could reach a record $300 billion, according to Goldman Sachs. That represents a 188% increase from the already huge $104 billion deficit recorded in 1989, and it does not bode well for America’s future.
A version of this article appeared in the November–December 1999 issue of Harvard Business Review.
