U.S. TRADE DEFICIT UP 1.9 PERCENT IN JANUARY
Imported goods at record $221B, led by pharmaceuticals
The level of imported goods to the U.S. in January reached unprecedented levels and pushed the trade deficit 1.9 percent higher as the coronavirus pandemic continues to distort global commerce.
The gap between the goods and services the United States sold and what it bought abroad rose to $68.2 billion from $67 billion in December, the Commerce Department reported Friday.
Exports rose 1 percent to $191.9 billion, while imports increased 1.2 percent to $260.2 billion.
Imports of goods, not including services, increased $3.4 billion to a record $221.1 billion in January, led by pharmaceuticals, which rose $5 billion, or 39 percent, to $17.4 billion. Imports of services fell about 1 percent.
The figure exceeded the previous record for imported goods of $218.9 billion set in October, 2018.
U.S. exports of goods rose
$2.1 billion to $135.7 billion in January, while exports of services, like transport and travel, declined $0.3 billion to $56.3 billion.
The politically sensitive trade gap with China fell 3.2 percent to $27.2 billion. The trade deficit with Mexico rose $1.6 billion to $11.9 billion in January.
The coronavirus has upended trade in services such as education and travel, sections of the economy in which the United States runs persistent surpluses. Measured in dollars,
monthly exports of U.S. services have declined by nearly one-fourth since the virus outbreak about a year ago.
Year-over-year, the goods and services deficit climbed to $23.8 billion, or 53.7 percent, from January 2020.
Last month, Commerce reported that in 2020, U.S. trade deficit rose 18.1 percent to $682 billion, the highest since 2008, as the coronavirus threw global commerce into disarray and stymied then-President Donald Trump’s attempts to rebalance America’s trade with the rest of the world.
Friday’s January trade data release is the last to include the period covering the Trump administration, which started a trade war with China and imposed steel and other tariffs on American allies that upended seven decades of U.S. policy.
President Joe Biden and his team have so far tiptoed around Trump’s hardline trade policies. Biden hasn’t called off Trump’s trade war with China or suggested he would scale back the tariffs on imported steel and aluminum.
Biden’s pick for his administration’s top trade negotiator, Katherine Tai, has promised to make sure that U.S. trade policy benefits America’s workers, not just corporations, and to engage more with U.S. allies to counter an increasingly assertive China.
Tai is waiting to be confirmed by the full Senate. Fluent in Mandarin, Tai spent several years as the Office of the U.S. Trade Representative’s head of China enforcement.
Q:
Regarding your recent article, does the Section 4741 approval of rental caps as low as 25 percent of the HOA mean a HOA such as ours can disallow rentals above that percentage? We are a small community with surging rentals, creating automobile congestion on our streets.
P.W., SAN DIEGO
A:
Civil Code Section 4741, new in 2021, allows HOAs to set rental caps as low as 25 percent. That is a minimum, so HOAs with current caps above 25 percent are unaffected by that aspect of the new law. HOAs adopting a rental cap should remember that Civil Code 4740(a) still applies so that the new cap, which is a partial prohibition, would apply only to owners acquiring title after the date the cap was voted into place.
Q:
A group of us would like to put out to a member vote to have our CC&Rs changed to have a 25 percent limit for rentals that is within the new Assembly Bill 3182 law in California. The board says their decision is to not have any limit and our current CC&Rs do not have any restriction on the number of renters. What can we do to get this out to a vote of all homeowners?
E.P., SAN DIEGO
A:
Over the years, my experience has been that the subject of rentals is the most common source of controversy when associations are discussing updating their CC&Rs. Some association communities prefer wide open rentals while others prefer a cap or other limitations. Before you put the HOA to the expense of a membership vote, consider informally polling your neighbors to make sure you have strong support for the idea. Amending CC&Rs usually requires a majority vote of all members and sometimes even requires a 75 percent approval vote to succeed. If you have enough support and the board still will not set a vote, you could petition for a special meeting of the membership. However, who is going to draft the proposed amendment? Normally that would be the HOA’s attorney, and the amendment must be properly drafted to prevent possible legal challenge. If you have a large amount of support for the idea, hopefully the board will listen to the community.
Q:
Civil Code 4740 has a paragraph grandfathering existing owners so that rental prohibitions would not apply, but now I see the new 4741 does not have that same paragraph. Despite that, it is obvious that the purpose of both 4740 and 4741 is to limit the rent restrictions allowed by a HOA.
T.Z.,
SANTA ANA
A:
Yes, the new Section 4741 does not contain a grandfathering provision, although that is not really its point. When Civil Code Section 4740 became law in 2012, its main point was to have newly adopted full or partial rental prohibitions only apply to future owners. The new Civil Code Section 4741 goes much farther, banning all “unreasonable” restrictions by HOAs on rental of homes. To a certain degree, Section 4741 overshadows Section 4740 since it is difficult to conceive of a prohibition that could possibly be adopted without running afoul of Section 4741(a).
Kelly G. Richardson, Esq. is a Fellow of the College of Community Association Lawyers and Managing Partner of Richardson Harman Ober PC, a law firm known for community association advice. Submit questions to KRichardson@RHOpc.com. Past columns at www.HOAHomefront.com.