Economy
U.S. Trade Deficit Widens To Record High : $68.9 billion
Is the number so large that we now almost treat it like it’s the tooth fairy, or Santa Claus, is it real? Most individuals hear the trade deficit number and think nothing of it, its like eternity, impossible to completely grasp.
There are many arguments that attempt to justify why a trade deficit is good for America, I do not buy any one of them. I ask routinely for an indisputable argument, I receive none.
There are arguments by individuals who say outsourcing is good, it lets us eliminate repetitive jobs and tasks, jobs people did not like doing anyways. Well here is the problem, as jobs go away so does demand. Anyone who has ever had Accounting 110, or Business 101, knows demand is a vital part of the law of supply and demand. Without demand we need no supply. So what can be done?
We need to provide better domestic corporate tax breaks. Giving breaks to people who spend their money buying things made in China provides no real benefit to the American economy. Rather than give useless tax breaks we should give corporations domestic tax breaks for keeping work here in America, this keeps us working and also keeps us spending, it promotes a healthy economy.
A tax break is an artificial way of stimulating the economy; it is not the long term answer.
We must also force countries into honestly evaluating their currency. Some major countries buy the American dollars and bonds on the open market just to make sure the value of the dollar stays stable, this allows their currency to stay undervalued in the global marketplace and keep their countries businesses in a very attractive light.
Most countries have figured out the key to being a world power in the next century is business and commerce; it is very bad business to run a company, no less a country, on a deficit balance. If America was a business, I think the CEO’s job would be in jeopardy at the next board meeting.
Related Posts
» Trade Deficit Symbolizes Foreigners Buying America From Us. Wait Until They Start Changing Your Life» The Trade Deficit Is On You And Me, So What Can Be Done?
» Bush presses China on Trade deficit
» President Bush Finally Gets Tough On China
» Questions For America’s Next President
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I hope Americans get it together and get this righted. We need work and money.
As long as individuals keep this in the publics eye we can put pressure on congress to help out. Remember their stance on this issue when you vote for Senators, and Representatives, and even your Governor.
Unfortunately the problem will only get worse before it gets any better. The Bush Administration seems to believe that the only way to “level” the playing field with China is to eliminate the middle class — leaving only low wage jobs (like China) and rich business owners.
Like you mentioned in this article the G7 is trying to get the Chinese to re-evaluate the Yuan. I don’t blame China for not wanting to re-evaluate…doing so would crush their current economic stronghold.