President Obama Could Reduce Trade Deficit with Executive Order
The following originally appeared on The United Steelworkers Blog.
The biggest national issue being ignored by both candidates and the voters in the current presidential race is the huge U.S. trade deficit. The candidates have been silent except to say they both favor a major new “free trade” agreement – the Trans-Pacific Partnership -”TPP”, mainly with low-wage Asian countries. But it will add to our trade deficits. And most voters don’t realize that the cheap imports they like so much have other heavy costs that must be covered by U.S. government debt.
Trade deficits mean that the United States is spending more abroad than we earn, so we must make up the shortfall by borrowing. We’ve been doing that since the dawning of globalization in the early 1970s. It’s made us transfer $8+ trillion of our national wealth to other nations by borrowing up to $2 billion every day, no doubt the largest such transfer from one nation to others in all of world history! It must be stopped now! It’s already the main problem in the weak economy and in jobs recovery, while taking us rapidly toward national bankruptcy! It’s an odd, dangerous omission for the candidates not to address the issue.
So why aren’t the candidates acknowledging the problem and offering solutions? Very simply, the forces in America who’ve done very well under “free trade”- the 1% on Wall Street, our biggest banks and our multinational companies want the status quo to continue. And they’re the ones making by far the biggest campaign contributions!
Our best hope is that President Obama will agree that national needs require a bold decision that he can take as president. An immediate executive order cutting the massive flow of imports into the United States is just one of the strong moves that only a president in office can take. America can’t wait until after the election for action. Our “Rome” is burning now, and we need the wise, aggressive leadership Mr. Obama is promising!
Kenneth Davis is a former U.S. assistant secretary of commerce/international, IBM vice president and chief financial officer, and investment banker.