You all,
The elder Bush got it right; Supply-Side, aka Urinate-Upon-Us is Voodoo economics.

Within the Import Certificate proposal, by significantly reducing USA’s trade deficit we’d increase our GDP which bolsters our median wage.

Within the IC proposal we’re dealing with production of aggregate products so we use dollars to keep score, but the goals are JOBS.

I’m a proponent of the IC proposal because it is fully funded by U.S. purchasers of imported products, a substantial stimulus which very much includes JOBS, Purely market driven and free enterprise.

Transfers of wealth are not the same as investing within our nation.
Investing occurs when goods and service products are consumed, used or dedicated to produce additional products of greater monetary values.

The sale of initial public offering securities provides additional capital for the issuing enterprises. Stock and bond transactions provide some additional brokerage commissions and jobs. Other than those small contributions, stock and bond transactions contribute nothing else to our economy.

There’s an inverse relationship between the GDP and the trade deficit.Refer to: World

Refer to:
topic of "Warren Buffett's concept to significantly reduce USA's trade deficit"

or www.USA-Trade-Deficit-Blogspot.Com

Respectfully, Supposn

Lots, they pay taxes don't they?

America Can No Longer Support Its Own Needs | Economy In Crisis


10. Real Unemployment: One Out of Five in US | Project Censored

~S~

__________________
I was so depressed last night thinking about the economy, wars, jobs, my savings, Social Security, retirement funds, etc., I called the Suicide Hotline. I got a call center in Pakistan , and when I told them I was suicidal, they got all excited, and asked if I could drive a truck...

a tax or tariff on imports would raise prices in America and so lower our standard of living. Plus it would start a Smoot-Hawley trade war which would limit our exports, reduce employment, and lower our standard of living still further. Econ 101. sorry

ShackledNation, the capital account is due predominately due to transfers of wealth. Transfers of wealth do not increase numbers of jobs, or median wage rates or median annual wage incomes.

Your other side of the equation is nonsense.

Respectfully, Supposn

Edward Baiamonte, within the Import Certificate proposal, by significantly reducing USA’s trade deficit we’d increase our GDP which bolsters our median wage.

We all benefit from cheap imported goods but U.S. wage earning families are dependent upon their U.S. wages every day of each year. The working poor derive the least amount of benefits due to cheap imports and due to our GDP being less than otherwise, wage earners’ annual wages are also affected. Wage earners’ proportionally suffer the greatest harm.

I’m opposed to accepting wage earners’ lesser living standards because other nations are unwilling or unable to better compensate their own laborers.

Refer to:
topic of "Warren Buffett's concept to significantly reduce USA's trade deficit"
or www.USA-Trade-Deficit-Blogspot.Com

Respectfully, Supposn

Oh god. You keep asserting bullshit, like "by significantly reducing USA's trade deficit we'd increase our GDP which bolsters our median wage" with absolutely noooo justification. You won't address arguments grounded in simple fucking reasoning, instead regurgitating your unfounded assertions and linking to your idiotic blog. Riddle me this: if you're not going to base a discussion in any form of logic or structured argument, why the fuck should anybody bother to read your posts?

A trade deficit does not reduce GDP. This is basic economics.

__________________
Am I the only professional here?

DSGE, I try respond to arguments. I sometimes respond to arguments made with inappropriate and unnecessarily bad language.

You do not believe that enactment of the IC policy wouldn’t increase our GDP. If you have already made your arguments to support your view point, didn’t I respond?

Are you faulting me because I didn’t respond, or because you were dissatisfied with my responding argument?
If you have not made an argument supporting your own views, why fault me for not responding to an argument you haven’t made?

Respectfully, Supposn

My problem is with the way you respond to arguments. You've had it explained how the " - M" term in the income-expenditure identity doesn't mean imports reduce GDP, it's there to prevent counting foreign goods consumed and invested as part of GDP. You respond not with any reasoning as to why that may be wrong, instead with shit like "No, that's incorrect". You've had explained to you how money that leaves the country to buy foreign goods invariably comes back into the country and is used to buy domestic goods, counting towards GDP. You talk garbage about "transfers of wealth" not being part of GDP, seemingly ignoring the last part of the sentence. You've been told one of the most basic principles of international trade, the kind of thing you learn in any introductory economics course, that the current account deficit is balanced by an equally sized surplus of the capital and financial account (something amazingly obvious if you're capable of half a second of thought). And you just say "that's not true". I mean just once, I'd like you to actually present an argument. Some form of structured reasoning. Not just useless references to your blog and other threads you've created which do exactly the same thing.

DSGE,
GDP = [(C+I+G) + (X – M)]

C= consumer spending, I= investment spending, G= government spending
Note that “I” does not include transfers of wealth.

Expenditures for stocks, bonds, financial funds or deposits into financial institutions are transfers of wealth.

Investments are the dedication of goods and services in anticipation of profiting from production of additional goods and services of increased values.

(C+I+G)=national spending
X=exports, M=imports, (X – M) = balance of trade.

Due to an IC policy “M” is likely to be reduced. The proportion of “M’s” reduction would be positively dependent upon what addition to import prices that U.S. purchasers are willing to pay; “M’s” a market driven variable.

I’ve heard speculations that enactment of the Import Certificate policy would increase import prices by more or less than a 10% rate; the market is a constantly changing variable.

Due to a 10% increase of import prices to U.S. purchasers, I expect the reduction of “M” to be perceivable but not of great significance. So much of “Ms” reduction will be replaced with purchases of other domestic goods and services. Those other products need not be a substitute or an alternative replacement for the import product that was not purchased; (i.e. having rejected to the increased priced imported electronic device, a gift shopper might choose to purchase theater tickets).

If there were suddenly less imported goods available within USA’s domestic markets, how do you believe USA’s expenditures would be affected? Much as it might benefit individuals to do so, I don’t believe Americans’ would purchase more stocks and bonds, or deposit more money in their bank accounts.

Due to that same 10% increase of import prices, exporters of U.S. goods additional IC revenues enable the reduction of U.S. exporters’ prices which in turn increases U.S. exports, (i.e. X).
I know that we disagree on this point. You expect net price wars. We wouldn't have a net price war even if the IC’s open market rate reached 20%.

Respectfully, Supposn

...........................

You've had explained to you how money that leaves the country to buy foreign goods invariably comes back into the country and is used to buy domestic goods, counting towards GDP. You talk garbage about "transfers of wealth" not being part of GDP, seemingly ignoring the last part of the sentence. You've been told one of the most basic principles of international trade, the kind of thing you learn in any introductory economics course, that the current account deficit is balanced by an equally sized surplus of the capital and financial account (something amazingly obvious if you're capable of half a second of thought). And you just say "that's not true". .........................,,,,,,,,,,, [/QUOTE]

DSGE, regardless of current and the capital account balancing or not balancing to each other, transfers of wealth do not induce additional investments for USA enterprises or additional jobs or an increased median wage or increased annual amounts of aggregate wages.

Respectfully, Supposn

Don't care about prices for now. Let's just focus on this.

So what I'm gonna do now is, instead of saying "no you're wrong", I'm going to identify the point in your reasoning where you have gone wrong and elaborate on it:

You've correctly identified GDP = (C + I + G) + (X - M), total consumption plus total investment plus total government consumption, plus the balance of trade. Your mistake is in assuming that the " - M" term means imports lower GDP. You're saying "all other things held constant, more M means less GDP". That's fallacious, because other things can't be held constant. M is also counted in C, I and G. "Total consumption" means the consumption of domestic goods and the consumption of imported goods. Same for investment and government consumption.

The "- M" component is just there so that things which have been measured as counting towards GDP, but also count the consumption/investment/etc of foreign goods, have the "foreign goods" part removed. We don't want to count foreign produced machinery that is used in our factories, or foreign produced beer that we drink, in our calculation of gross domestic product. But all that stuff is present in C, I and G. So we subtract M from everything so that we don't count foreign made stuff.

Absolutely it does. Do you think people lend us money or buy equity in our firms just so that we can take that money and stick it in some mattresses? The fact of the matter is that they give us money so that they can get a return on it. Returns aren't generated by just giving your money to the magic money tree, and in 5 years the tree gives you back your money plus interest. Returns are generated through using the money for investment. That means buying goods which make a firm be able to produce more, and earn more profit.

But you're looking at the causality the wrong way around. Rather than thinking about wealth being transferred into the country and resulting in goods being bought (which is still accurate), it's easier to think of it from the borrower's point of view. If we want to consume/invest more goods than we have produced, we have to get them from overseas, running a trade deficit. But how is that deficit financed? We borrow internationally. In aggregate, we need to borrow money from abroad in order to buy goods from abroad. The transfer of wealth from them to us occurs because we want to buy more goods than we can produce.

Some specific product prices may not reflect all goods and service that contributed or supported the production of the specific items.

Enterprises occasionally benefit from university or government research and development assistance provided at lesser or no cost to the enterprise. Local governments may provide beneficial infrastructure to induce an enterprise’s relocation. Enterprises may manipulate their cost accounting to encourage the market for their newer products. All of this is of no consequences with regard to domestic products sold within the nation’s domestic markets.

The majority of goods and services that support the production of a final product global product are produced within the same nation as the final product. To the extent that those supporting products are not included within the prices global products they support, global product prices are understated.

The benefits of production are earned by the producing nations and denied to the importing nations;
(i.e. ALWAYS trade surpluses contribute and trade deficits are detrimental to their nation’s GDP).

Furthermore due to under-statements of global trade products’ prices,
Surpluses contributions and trade deficits’ detriments to their nations’ GDPs are generally understated.

Respectfully, Supposn