None of you strange people who have managed to overthrow common sense by reading an article or two about the desirability of a trade deficit or the harmlessness of a trade deficit by some professor who lives with his head up his ass, and not in the real world, have yet to explain why all other nations like China, for example, bend over backwards to avoid a trade deficit, or why they are not in competition to create their own trade deficit, or why they are not in a rush to build their factories in the United States.
As for what they do with their dollars, they are buying American real estate, Hollywood, the Panama Canal; they already have bought all the movie theater chains in the United States, building a top rate military, building up their nation; other assets around the world.
I have a simple question for you.
In 1994 -- the year NAFTA was fully implemented -- the U.S. exported $50.8 billion worth of manufactured goods to Mexico, and imported $49.5 billion of manufactured goods from Mexico. In manufactured goods, we had a trade surplus of $1.3 billion with Mexico.
In 2015 -- the last year with full-year figures published -- the U.S. exported $235.7 billion worth of manufactured goods to Mexico, and imported $296.4 billion of manufactured goods from Mexico. In manufactured goods, we had a trade deficit of $60.7 billion with Mexico.
By any objective economic measure, was the U.S. better off in 1994 or in 2015?
I seem to remember hearing the same thing back in the 1980s when it was Japan, not China, who was doing all this.
It reached a peak in 1989 when Mitsubishi paid $850 million for a controlling stake in Rockefeller Center in New York City. By 1995 they filed for bankruptcy protection, and Mitsubishi ended up writing off about a $1.8 billion loss on its books when it bailed out of the asset.