A high trade deficit will cut into the value of the dollar, and casue inflation. It is very harmful to this country.
Posted on 02/18/2005 9:55:18 AM PST by Willie Green
The value of the dollar has declined signficantly since then.
And what has happened to the American standard of living in those thirty years? Has it suffered? No.
Next?
A whole bunch of hucksters are making a load of money off of our "free trade" policies with mercantilist China, and you do not need to come here and upset their apple cart.
its why we barely can hold GDP growth in the low 3% range, while China is running 8-9%.
we must somehow force china to float its currency.
We're doomed!!!
Like I've said before, there is a serious lack of economics education in this country, even among conservatives. Go take a Econ 101 class at your local friendly neighborhood community college.
A high trade deficit will cut into the value of the dollar, and casue inflation. It is very harmful to this country.
Exactly.. The funny thing is the Trade deficit was going up in the 90's but we have not seen on peep about the trade deficist at all. I wonder why...
"Per capita income in Europe and Japan is on a par with America. The European Union actually has a larger combined economy than does the United States, with Japan in third place. Both the EU and Japan run trade surpluses, and in fact use their large gains in the U.S. market to boost their own economic output and income."
And these trade surpluses get them what? 10% plus unemployment and no growth in Europe, deflation and stagnation in Japan. Not to mention massive demographic issues regarding pension funding in both. These doom and gloomers should go to Europe every now and then.
Europe's infrastructure is crumbling. My 15 year-old daughter just returned from a semester in Italy. She was amazed that a supposed 1st world nation could not guarantee that running water would be available on a daily basis in major metro area. The availability of goods and services was maddeningly inconsistent and not on par with the US. Even the pizza was lousy.
Per capita income in Europe is inflated by government salaries and welfare payments. As a result, the tax rates across the EU are double ours, sometimes more. The result is NO GROWTH and NO JOBS.
The misinformation in this article is legion. Hoopleheads!
Where did this concept that a nation has to pay for the things it imports come from ? Hey we can just run up the plastic forever with no end in sight.
afford what imported goods? chinese ones? in fact, most americans cannot afford imported goods from first world countries - europe and japan. the fact that many americans can ONLY afford goods from china is not a sign of our wealth.
"Per capita income in Europe... is on a par with America"
That is absolutely not true. It is a blatant lie, look at any reference on the subject. European per capita income is significantly below US.
/sarcasm too?
Not at all. In fact when there isn't one is when things are going to be bad. When people stop consuming it means there's trouble at home.
Take a look at Germany for a good example. they have a trade surplus, but a failing economy. No economic growth at all 5 years running for the most part. It's partly because they are spending too much at home feeding their high social costs.
The last 5 was a time when they should have had good growth. Now as we move into a slump cycle, It will interesting to watch
Yeah, but China's a developing economy, I expect their GDP numbers to grow astronomically as they convert to a quasi-capitalist system.
Their gains are coming from infrastructural growth; ours come from population and productivity gains, and the marginal march oh technology.
"the fact that many americans can ONLY afford goods from china is not a sign of our wealth."
You are purely insane. People and businesses will get their goods and services at the lowest prices available, that is NOT a sign of poverty. You are making no sense and apparently have never taken an introductory economics course(or didn't pay very close attention).
Umm... Where is all this rampant inflation when we have record trade deficits now? Are they just arriving fashionably late?
I'm not listening to him. I don't care what he thinks. And I'm well aware that tariffs increase prices and business costs. All taxes do that. We could lower (or elimiate completely) the corporate income tax at the same time. Don't tell me that consumers would bat an eye at paying one or two percent more. And if they do, so be it. Supply and demand will apply and we'll get less of that product. Why is it ok to have income taxes but not tariffs? It's a revenue source that has been ignored since this absolute free trade nonsense started.
You still have not addressed your misstatement on GDP. Do you understand the parts of the GDP equation? The trade balance is accounted for in the rest of the equation, do you understand this? If so, why did you imply otherwise?
If you knew anything at all about history you would recognize the point at which major powers begin to die. And the 'what, me worry ?' blind complacency you exhibit.
I'll call your philosophy Mendozaism. There was a Spanish grandee named Mendoza who proudly proclaimed in 1659 that Spain was great because all the world exported to Spain while Spain exported nothing. Trade deficit ? Who cares ? People who think that Spain needs to export finished goods are just being hysterical.
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