How long will it be before toddster spouts the advantages of the US having a trade deficit and he post his rising income chart?
Why don't you ping him and find out?
Rising income charts are crap... standard of living in US has only rose moderately since 1970... and it has done so largely by the fact that most households are now 2 income not one... a complete opposite of how it was in 1970...
Our standard of living is declining in terms of real dollars when you take this into account and it directly correllates to the decline of manufacturing and rise in service industry jobs.
Sorry, but manufacturing generates about 3.5 jobs per direct job.. service 1.6... that's facts folks, and free traders can lie all day long, but its the truth.
I never said there was an advantage to the US having a deficit. You sure as hell haven't shown me there is a disadvantage. Perhaps you prefer Germany's economy which has been running a trade surplus for a very long time?
would you like a trade surplus, say like Japan with its 0% GDP growth. OR like Germany with its 12% unemployment.
The last time the US had a current account surplus was 1991, when unemployment was 8%, GDP growth was 1% and Al Gore was calling it the worst economy in 50 years. the uS has had consistently a trade deficit since about 1971 and did so for the first 100 or so years of its existance.
I'll explain this becasue no one here really understands it. The US has a trade deficit for two reasons:
1. Our GDP growth is much fast than our developed partners GDP growth
2. The US Invests more than it Saves, so it must import capital.
Notice none of the reason were free trade or unfair trade practices.
If you dont like the trade deficit, I suggest stop buying not only foreign goods but US Made ones as well (US goods consumed here are goods that cannot be exported, so yes when you consume US goods, you are increasing the trade deficit). You should buy US and Foreign Govt BONDS. This will drive the trade deficit towards balance faster than any silly mercantilist trade policies.