America's Superpower Status Coming to an End

Newsmax.com ^ | 3/1/05 | Paul Craig Roberts

[beyond the sea]

The U.S. economy is headed toward crisis, and the political leadership of the country – if it can be called leadership – is preoccupied with nonexistent weapons of mass destruction in the Middle East.

The U.S. economy is failing. The afflictions are serious. They could be fatal even if diagnosed and treated. America is losing the purchasing power of its currency and its ability to create middle-class jobs. Story Continues Below

The dollar's sharp decline and projections of continuing trade and budgetary red ink are undermining the dollar's role as reserve currency. A number of central banks have announced that they will be diversifying their currency holdings and will not be buying dollars at the same rate as in the past. This will put more pressure on the dollar. At some point, the flight will begin. Instead of buying fewer dollars, central banks will sell dollars, hoping to get out before the dollar hits bottom.

Suddenly, the advantage of being the reserve currency becomes a nightmare, as the world's accumulations of dollars are brought to market. An enormous supply and weak demand mean a very low exchange rate for the once almighty U.S. dollar.

Overnight, those cheap goods in Wal-Mart, which are the no-think economist's facile justification for Wal-Mart's decimation of communities, small businesses and employment, shoot up in price.

[Toddsterpatriot]

No, I am saying that if we continue to export, as we have been exporting, we are going to go broke.

Well, at least you now admit we do export. Glad we got that straightened out.

In the future if you mean to say we don't export enough or we import too much, please say that rather than "We do not produce much of anything worth exporting"

That statement is untrue and so easily refuted it degrades the rest of your argument.

The national debt was $6,783 billion in September of 2003, and increased to $7,379 billion, by September of 2004. That change is about the same size as our current account loss...

Current account loss? Never heard that phrase before. Are you sure you're using the proper term?

[superiorslots]

Quote: U.S. exports did climb to an all-time high, helped in part by a 15 percent decline in the value of the dollar against other major currencies over the past three years. A weaker dollar makes U.S. products cheaper and thus more competitive on overseas markets.
For 2004, exports of food, autos and auto parts and consumer goods climbed to a record and the export of capital goods was at the highest level in four years.

Source: MSNBC



Rudeboy, In my best Ronald Reagan voice: "There you go again" You are leaving important facts out by omission.

Freepers read the MSNBC article. Imports are at an all time high.

Here are some points rudeboy left out:

Imports of foreign autos, industrial supplies and consumer goods all set records as did imports of food products, which climbed to $62.17 billion. U.S. exports of food products were also a record at $56.3 billion. But since U.S. shipments abroad were lower than imports, the country recorded a deficit in food categories of $5.8 trillion. It was the third straight year the United States has run a deficit in food, which long had been one of the few areas where the country could depend on surpluses.

U.S. exports did climb to an all-time high, helped in part by a 15 percent decline in the value of the dollar against other major currencies over the past three years. A weaker dollar makes U.S. products cheaper and thus more competitive on overseas markets.

For 2004, exports of food, autos and auto parts and consumer goods climbed to a record and the export of capital goods was at the highest level in four years.

The deficit with China was up 30.5 percent from the previous record for any country, a deficit of $124.1 billion with China set in 2003. The United States also saw large increases in the deficits with Japan, at $75.2 billion, Canada at $65.8 billion and the 25-nation European Union, where the deficit rose to $110 billion.

[ARCADIA]

Are you sure you're using the proper term?

Current account loss: as in Current Account (loss/deficit), or our trade balance.

Here are Greenspan's recent comments on our current account. He pretty much recaps most of the issue that we have been discussing here.

http://www.federalreserve.gov/boarddocs/speeches/2005/20050204/default.htm

[1rudeboy]

Oh, please. I responded to your comment that the "problem is the export orders have not materilized like corporate leaders thought AND said they would over the last 1-3 years." [emphasis added]

I demonstrated it to be patently false.

On what planet is it customary to speak of imports when the topic on the table is exports? Nice argument, let me summarize.

ss: I say 'A.'
1rb: 'A' is simply not true, here is why.
ss: But you failed to mention 'B!' Dissembler!

[Toddsterpatriot]

Current account loss: as in Current Account (loss/deficit), or our trade balance.

Current account is neither lost nor gained. Say the increase in our current account deficit. :^)

[Toddsterpatriot]

On what planet is it customary to speak of imports when the topic on the table is exports?.

Is it a virus? Are the protectionists all using the same dirty keyboard? Yuch. Please guys, wash your hands or use protection while posting.

[1rudeboy]

Don't think it's a virus. Hysteria, maybe.

[UCANSEE2]

Well, so far I have just read the excerpted part at the top of the thread, and I CAN'T FIND ONE TRUE STATEMENT.

[Toddsterpatriot]

Hysteria, maybe.

Main Entry: hys·te·ria
Pronunciation: his-'ter-E-&, -'tir-
Function: noun
Etymology: New Latin, from English hysteric, adjective, from Latin hystericus, from Greek hysterikos, from hystera womb; from the Greek notion that hysteria was peculiar to women and caused by disturbances of the uterus

I know these guys(?) are all about emotions and feelings, but I didn't think they were all women. That would explain some things.

[Toddsterpatriot]

and I CAN'T FIND ONE TRUE STATEMENT.

Don't worry, it's Paul Craig Roberts. He used to be somebody.

[1rudeboy]

I'm still chuckling. So this guy watches some yob on Cavuto saying that he hasn't seen the uptick in orders for export; I demonstrate otherwise, so he changes the subject. What a hoot.

[UCANSEE2]

Here's an example. Very first sentence.

The U.S. economy is headed toward crisis,

The economic trends and factors are all very high. The main bugaboo, Social Security, is schedule for overhaul. The author of the article is a reporter, not a financial expert.

and the political leadership of the country – if it can be called leadership

If referring to Bush's administration staff, he is dead wrong. If referring to Senators and Congressmen (from both parties) there is some merit to that snide remark.

is preoccupied with nonexistent weapons of mass destruction in the Middle East.

Again, the DEMS are preoccupied with this, not the Bush staff.

[Toddsterpatriot]

So this guy watches some yob on Cavuto saying that he hasn't seen the uptick in orders for export; I demonstrate otherwise, so he changes the subject.

Or the guy who said NAFTA was a failure because "All you free traders said it would turn Mexico into a 1st world country and stop all illegal immigration"

Hysteria indeed. Easier than rational thought and hard facts.

[William Terrell]

What is "amiss" is the blatant propping up of our Dollar by foreign powers such as China, India, South Korea, Japan, Europe, et al in order to artificially lower the costs of their exports while simultaneously raising the costs of our own exports.

I agree. But we are in this mess because of loose fiscal policies and certain powerful factions' lust for world governance.

As for "economy leveling," some amount of leveling is always going to be taking place...though limited by cultural (e.g. work ethic, holidays, gender biases, etc.) and bureaucratic (e.g. compliance rules for establishing new businesses) factors.

The hell it is. The only economy leveling is by deliberate measures aimed at that goal. The effect of economy leveling is to reduce the standards of this country to some 3rd world hellhole. Thank you, but I decline.

Where they can, most second and third tier nations are going to gleefully adapt American-pioneered productivity solutions, and as more people become educated at some rate in such countries, they'll be positioned to directly implement more and more of our own solutions.

They "gleefully" adopt American technology to get it without the capital expenditure to develop it for themselves for their own advantage, to use that advantage to reduce American competitiveness in the world markets where we should not be in the first place to the extent we are. The leadership of the 2nd and 3rd tier countries (3rd world hellholes) do not wish America well.

That still leaves the U.S. in the lead, however.

With our trade deficit? With the vanishing industries to slave labor countries? With the technical outsourcing, which was what we could fall back on? Your memory for political statements of yesteryear is very short.

The U.S. holds every card.

The Us held every card. You seem to have not noticed that the cards are rapidly vanishing from the deck

I still have seen no justification for extended world trade for the good of America and its people. We did much better when we produced what Americans need domestically and traded with each other.

[William Terrell]

Finally, a protectionist pins himself down. So, in 5 years when the country is still doing well will you finally stop your whining?

In about 5 years the damage should be evident to all but a few boneheads.

Justify for me, for the good of America and her people, head over heels involment in world trade as opposed to producing what American's need to live domestically and trading among ourselves within the country.

[Toddsterpatriot]

In about 5 years the damage should be evident to all but a few boneheads.

So, when we're still doing great in 5 years you'll shut the hell up? Deal?

[1rudeboy]

[Southack]

"You mentioned that our low dollar would bring us export orders. The problem is the export orders have not materilized like corporate leaders thought AND said they would over the last 1-3 years. They are totally flabbergasted why it is not happening. Saw this on Cavuto myself. There was a manufacturing council member on the show and they were stunned the orders were not coming in like they thought they would..."

Our exports *are* up substantially.

[Southack]

US manufacturing sector continues to expand; growth rate dips
newratings.com ^ | March 2, 2005 | unattributed

Posted on 03/02/2005 8:50:16 AM CST by 1rudeboy

NEW YORK, March 2 (newratings.com) – US industrial production increased for the 21st consecutive month in February this year

[Southack]

"The hell it is. The only economy leveling is by deliberate measures aimed at that goal. The effect of economy leveling is to reduce the standards of this country to some 3rd world hellhole. Thank you, but I decline."

We must be talking past each other, because I think you'd agree with me otherwise. Let me try an example.

You get "economy leveling" when a 3rd world nation buys its first weaving machine. This doesn't mean that the 3rd world country suddenly has American standards of living...our economies aren't actually "level," but they will move a little bit closer to parity. India did this in the 1970's. 3 decades later their economy is no where near ours, but yet, it is far more "level" than it was in 1975.

What I am saying is that 3rd world nations want to buy, and will buy and adapt when they can, American productivity advancements like weaving machines, refineries, cotton gins, robots, software, etc.

Those tools will enhance said countries' economies...they will become closer to level with the U.S., but they are unlikely to reach our actual level due to cultural and bureaucratic restraints (red tape, corruption, gender biases, holidays, etc.).

What you seem to be referring to is something different: wealth redistribution...where one nations gets free handouts at our expense...where the U.S. is torn down (e.g. the Kyoto Global Warming Nonsense) in order to redistribute wealth (OK, call it "carbon credits") to 3rd world nations. That's a different beast. I'm not talking about that sort of "leveling."