Every year, hundreds of billions of dollars leave the rapidly depleting coffers of the United States and go to China. This huge transfer of wealth has resulted in dramatic effects for both countries. For China, it has brought about an economic boom; for the United States, an economic decline. Chinese loans to the U.S. government, to the tune of over $1 trillion, have made a large contribution to this result. Effectively, this has silently granted the Chinese government an alarming amount of leverage over our economy.
Tag Archives: Trade Deficit
Americans are deceived into believing they benefit economically from outsourcing, offshoring production and an unprecedented trade deficit. In reality, the United States giving up its wealth for plastic trinkets and outsourcing is the cause for rising poverty and joblessness all across the nation.
President Obama promised 5 million green jobs during his presidential campaign in 2008. Not only did he fall short by a long way, but in fact we’ve lost hundreds of manufacturing companies, with thousands of employees laid off. During his 2012 re-election campaign, President Obama promised jobs again, this time promising 1 million manufacturing jobs which he has yet to come close to fulfilling. He has only added a little over 189,000 manufacturing jobs. With so little being made in the United States compared to decades ago, we must now, more than ever, join together and buy American made products.
Our trade deficit is at an all time high, especially with December’s jump when exports fell the most and Americans bought a record amount of imports. This jump was the highest increase that has occurred in over two years. The deficit jumped over 17 percent to a whopping $46.6 billion. Our trade with China is much to blame for this since China set a record with the U.S. last year, increasing our trade deficit 23.9 percent.
When NAFTA (North American Free Trade Agreement) was passed, many people feared the worst. The results have indeed been disastrous for the U.S. Economy:
- The trade deficit with Mexico has exploded
- Mexican wages remain nearly as low as they were prior to NAFTA and are still a small fraction of our average wages
- Wealth and power has not filtered to the people. Most of Mexico is still controlled by less than 100 corporations in Mexico
- Many of our other trading partners have relocated facilities to Mexico to circumvent other trade agreements with the U.S.
- American manufacturing has lost 1 million jobs in the past 20 years as U.S. companies have also moved to Mexico for lower wages and lax regulation