Two Problems With the Trade Deficit
An ongoing trade deficit is detrimental to the nation’s economy because it is financed with debt. The United States can buy more than it makes because it borrows from its trading partners. It's like a party where the pizza place is willing to keep sending you pizzas and putting it on your tab. This can only continue as long as the pizzeria trusts you to repay the loan. One day, the lending countries could decide to ask America to repay the debt. On that day, the party is over.
A second concern about the trade deficit is the statement it makes about the competitiveness of the U.S. economy itself. By purchasing goods overseas for a long enough period of time, U.S. companies lose the expertise and even the factories to make those products. Just try finding a pair of shoes made in the America. As the United States loses competitiveness, it outsources more jobs, and its standard of living declines.
How the US Trade Deficit Hurts the Economy
Your first point is bullshit. The national debt has nothing to do with the trade deficit. We have a trade deficit because you and I and just about every other American chooses to buy things made in other countries. Every toaster bought from China at a WalMart or every BMW bought from the dealer or ever bottle of wine from Italy. They are all being bought by the citizens and not the government.
We have a national debt because the federal government spends more money than it brings in, but it is not spending that money on buying foreign goods.
I do agree we lose expertise and factories over time, but if those jobs are replaced with similar paying jobs, then there is no change in standard of living
You posting this picture, as if this is proof of something. It isn't.
Are you denying the lowering of living standards for the Working Poor and the Middle Class?
Further, you seem to operating (based on this picture), that if we had protectionism, that rust belt towns wouldn't exist. That somehow these factories would stay open forever, and there would be all these 1950s happy workers dumping molten metal everywhere.
NOpe.
More jobs have been lost through automation, than through trade. Yes, there is no doubt that some companies have lost jobs over trade, but that is not the primary driver. The primary driver is advancement.
Germany has TWICE the level of manufacturing employment we do. Japan has even more.
So, is that because they use old fashioned manual labor to make their stuff, and "out compete" US?
LOL!!!!!
By the way, it's funny how if you watch the old movies, people are miserable and down trodden factory workers, and now we dream of that coming back.
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Yes of course..... let's all go back to being miserable factory workers. I worked at a factory years ago. It sucked. I wouldn't want to go back. I certainly wouldn't see that as a dream for America's future.
You had a hard and crappy job. And were paid well.
Today, your modern counterparts, have crappy hard jobs and get paid shit.
We will not have an American future, if we actively refuse to give any consideration to the working poor and middle class, in our policies.
Are you denying the lowering of living standards for the Working Poor and the Middle Class?
Yes, I am. It's a known fact, that people who are "working poor" today, are living far better off than the working poor of the past. By far. You read about the working poor of the 1950s, and they didn't have hot water, air conditioning, most didn't have cars, and they certainly didn't have any of the modern conveniences that today's poor do.
Did you know, by the way, that a couple working minimum wage jobs at McDonald's, places them in the top 1% of wage earners in the world?
Now I will say that one clear problem is that people now routinely live in broken families, and that destroys the ability to build wealth. But that isn't from a lack of economic opportunity, but rather the destruction of the family by left-wing ideology.
If you think Tariffs are going to fix that, you are crazy.
Germany has TWICE the level of manufacturing employment we do. Japan has even more.
So, is that because they use old fashioned manual labor to make their stuff, and "out compete" US?
LOL!!!!!
Yes, and Germany operates on the basis of free-trade. Germany also operates on a system where Unions work with Companies in a co-operative manor, rather than an adversarial manor.
For example, Unions in Germany would never drive the company into bankruptcy, like the Union at Hostess did. They would work with the company, to reduce costs, even labor costs, in order to keep the company competitive.
You had a hard and crappy job. And were paid well.
Today, your modern counterparts, have crappy hard jobs and get paid shit.
We will not have an American future, if we actively refuse to give any consideration to the working poor and middle class, in our policies
No, I was not well paid. It was just crappy factory job.
And the pay level is not any worse than what it was in the past. Just not true.
Fact defeat opinion.
Statistical abstract of the United States / prepared by the chief of the Bureau of Statistics, Treasury Department. 1976.
Notice, Average hourly wage for manufacturing in 1960, was $2.26 per hour.
According to the CPI inflation calculator, the comparable wage would be $19.41 today. That is almost dead on what manufacturing wages are today. In fact, the average is $20.50.
Wages in manufacturing have not declined. People are paid what the job is worth, back then, and today.
What has changed is that everyone else has found work that is more valuable and profitable to do. The rest of society has moved on to doing more valuable things that result in higher pay than manufacturing. My friend from Bangladesh, is a Lead programmer with Nationwide Insurance. He's making $100K a year.
Wages didn't decline in manufacturing. Other people's wages increased, because they are doing more profitable things than manufacturing.
If you don't think you are paid enough.... get out of manufacturing, and do something more profitable. It's that simple.
