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USA’s chronic trade deficits

Discussion in 'Economics, Business, and Taxes' started by Supposn, Mar 19, 2016.

  1. Supposn

    Supposn Council Member

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    EatTheRich, Hitler first invested his resources into infrastructure to immediately increase employment and the median wage. It was economically advantageous to Germany and politically advantageous to Hitler. He soon expanded his efforts for preparing for war and finally his nation was on full war status.

    Germany was on a full pre-war and later war- time economic status. They needed all of their production and labor resources.
    Trade deficits greatest economic detriment is to their GDP and is primarily due to reduction of jobs and consequentially also the median wage.

    When there’s full employment any net economic detriment due to the nation’s trade deficit is significantly much less (than otherwise). The benefit of Germany’s trade deficit was primarily militarily strategic rather than economic. Germany was to some extent freeing their existing production resources for greater war productions and at the same time competing against the allies for foreign resources.

    Respectfully, Supposn
     
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  2. Supposn

    Supposn Council Member

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    EatTheRich, trade deficits are NEVER economically beneficial to their nation, but your comments regarding pre-war Germany brings up an interesting sub-topic.

    Franklin Roosevelt’s administrations invested our resources into infrastructures to immediately increase employment and retain some wages in our economy. It was economically advantageous to the USA and politically advantageous to FDR.

    There was a time when the retention and improvement of USA’s public and quasi-public infrastructures were bi-partisan political efforts. The degradation of our nation’s infrastructure that we’re still tolerating is to our embarrassment and our economic detriment.
    Businesses would invest more into their enterprises if our government were more willing to invest into our common infrastructures.

    Other nations can afford to modernize their railway systems, start remedying their pollution, care for their sick, their elderly, their veterans and better educate their children, but we cannot?

    USA doesn’t lack for investment capital; we lack the will to invest in ourselves.

    Respectfully, Supposn
     
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  3. EatTheRich

    EatTheRich President

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    I would suggest that American capital was the primary beneficiary of several well-known agreements, such as NAFTA and GATT. That doesn't mean that the American public benefitted as a whole--far from it. The fact is that any policy that discourages cheap imports will prop up certain businesses at the expense of the public weal.
     
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  4. Lukey

    Lukey Senator

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    Isn't that precisely what the Marxists do? They can only justify Communism is by claiming that Capitalism is economic dysfunction?
     
  5. Supposn

    Supposn Council Member

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    EatTheRich & Lukey, a policy that hinders particular kinds of cheap imports into the USA can boost particular USA industries or even whole families of a general type of industry.

    It cannot boost particular enterprises unless the enterprise in fact dominates the entire industry; (i.e. unless the industry itself is uncompetitive).

    To the extent that a policy hinders more general rather than particular kinds of cheap imports into the USA it can boost many more general industrial families rather than a particular USA industry or family of industries.

    NAFTA in effect boosts industries of foreign low-wage nations to the detriment of USA’s GDP, numbers of jobs and thus to our median wage. You guys advocate USA continuing to gladly tolerate these net economic detriments.

    Respectfully, Supposn
     
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  6. The Sage of Main Street

    The Sage of Main Street Governor

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    Dictatorship of the Plutariat

    Unknowingly, you just proved how much Capitalism is like simple-minded Communist tyranny. You've committed the "You Did It Too (Tu Quoque)" fallacy.
     
  7. EatTheRich

    EatTheRich President

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    Nazi Germany was organized for permanent war, and ran chronic trade deficits to finance its war machine. U.S. imperialism today is also organized for permanent war. Thus, it is no surprise that it also runs chronic trade deficits.

    Now on to NAFTA. Far from being a free-trade measure that propped up Mexican industry, it actually codified (and in some cases raised) barriers to the inflow of Mexican goods, while eliminating barriers to the export of American and Canadian goods to Mexico. Mexican peasants and workers were unsurprisingly the biggest victims of the agreement.
     
  8. Lukey

    Lukey Senator

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    Actually all I did was point out the hypocrisy of communists claiming that capitalists mischaracterize their many failed economic experiments.
     
  9. The Sage of Main Street

    The Sage of Main Street Governor

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    Of Course, the Phony Left Never Points This Out


    Unaware that they are contradicting their support for the system, successful Capitalists brag about what a high percentage of their competitors failed and wasted both their investors' money and their employees' time. Being so hard to accomplish something in their favorite system is supposed to make them look good; that's how stupid they are, because it makes the system look as incompetent as the government.
     
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  10. Supposn

    Supposn Council Member

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    The Sage of Main Street, you apparently do not appreciate the consequences of value assessments within the Import certificates’ concept. The two purposes of the Import Certificate proposal is to (1) significantly reduce or eliminate our chronic annual trade deficits’ detrimental effects upon our GDP and numbers of jobs and their reflections upon our median wage. (2) It’s an indirect but effective subsidy of USA exported goods. It’s purpose is not to determine or cause “equitable pricing” of imported goods sold within the USA.


    Assessments of goods within the Import Certificate proposal are based upon market values within the borders of the USA, expressed in U.S. dollars. In most cases, (if there’s objections to a particular federal government’s valuation), comparisons can be readily made with market prices of more or less similar goods that have been or are sold in the USA. The valuations are approximations but they are approximations much more related to actual rather than theoretical prices. The the assessment of values are unconcerned with differences between actual USA production costs and the cost of foreign goods entering the USA.


    [Exporters of goods from the USA are entitled, (not required) to request that their goods be assessed and they agree to pay the federal assessment fees. Import Certificates are only issued as adjustments for overpaid fees or to exporters of goods that have been assessed and have paid their fees and their goods have departed from the USA. The “face value” printed upon those certificates is the assessed value of the exported shipment; it’s NOT the assessment fee.

    The federal fees are (by law) set to defray all direct net federal costs due to this trade policy. The fee rate’s a uniform annually published percentage rate of exported shipments’ assessed values. That fee rate is annually reconsidered and (if necessary updated).


    The fees ARE NOT a net source of federal tax revenue and thus a very small percentage of goods valuations. The accuracy of these value approximations are not at all critical but if the assessments between shipments are unreasonably incorrect in proportion to each other, some mischief certainly can occur. That’s why efforts should be made to keep approximations more or less real.


    Regardless of how low transferable Import Certificate’s price should ever fall within the competitive global market, USA Imported goods will never be able to exceed the assessed values of USA’s exported.


    To the extent that USA’s exports are ever reduced, prices of imports sold to USA purchasers and subsidies of exports sold to foreign purchasers will increase.

    To the extent that USA’s exports are ever increase, prices of imports sold to USA purchasers and subsidies of exports sold to foreign purchasers will be reduced.

    While this policy significantly reduces (if not entirely eliminating) USA's annual trade deficits of goods; the competitive global market for transferable Import Certificates regulates these prices of USA's globally traded goods with no additional government intervention.


    The performance of USA’s GDP, numbers of jobs and our median wage within our adoption of an the Import Certificate policy would be never be inferior and would often be superior to their performance if we continue to seek a pure free trade policy. Certainly under ALL USA trade policies USA’s economy benefits from increasing exports of our goods but success of the Import Certificate policy is not dependent upon such increases.


    Respectfully, Supposn
     
    Last edited: Apr 14, 2016
  11. Supposn

    Supposn Council Member

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    Eat the Rich, your assertion that chronic annual trade deficits funded the Nazi war machine and the USA’s war Department and to this day still funds USA’s Department of Defense is complete nonsense.

    During full wartime status, a trade deficit certainly provides strategic military advantages. While a nation is experiencing near full employment, economic detriments due to the nation’s trade deficit are greatly reduced. But trade deficits are ALWAYS of some net economic detriment to their nation.

    We share a cynical opinion regarding any governments’ policies “trickling down” to be of any significant benefit to their nation’s employees and the employees’ dependents.

    I do believe that some participants of this thread share my anticipation of reading your explanation of Mexico’s net economic detriment due to NAFTA. You may be correct but I’m unaware of such net detriments. Please do explain that to us all.

    Respectfully, Supposn
     
  12. EatTheRich

    EatTheRich President

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    Before 1959, Cuba was considered a success because its people were better off than the people of Haiti. Since 1959, it has been considered a failure because its people are not as well off as the people of the United States.
     
  13. EatTheRich

    EatTheRich President

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    http://www.nytimes.com/roomfordebat...-suffered-and-the-united-states-felt-its-pain

    Real wages have declined, unemployment has gone up, farmers have lost their farms, and an antilabor offensive has been mounted (including the long and devastating war in Chiapas).
     
  14. Lukey

    Lukey Senator

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    No it's considered a "failure" because people will do almost anything to leave there and come to America:

    https://www.google.com/search?q=cub...rpDMAhWDpB4KHcXdCtcQ_AUIBygB&biw=1594&bih=922
     
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  15. EatTheRich

    EatTheRich President

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    Oh. Well, then Chile is also a failure after applying monetarist theory, sound money principles, austerity, and debt reduction. Haiti, which has had no social revolution and has seen the already considerable standard-of-living gap with Cuba increase tremendously since 1959, is also a failure. Mexico is a failure. Really, most of the capitalist world is a failure. Yet, you selectively focus on the "failures" of a country that has increased its literacy rate by something like 50%, built a world-class health program, and done away with homelessness.
     
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  16. Lukey

    Lukey Senator

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    So if Cuba is so wonderful and the US such a mess, why aren't poor Americans packing themselves into rickety watercraft and risking being eaten by sharks to go THERE?
     
  17. The Sage of Main Street

    The Sage of Main Street Governor

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  18. Woolleybugger

    Woolleybugger Mayor

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    The whole free trade idea was cooked up by economists in the back pockets of corporations. I could never understand the logic myself. We put 1 million steel workers and clothing makers out of work so we can buy cheap stuff from abroad and somehow that improves the lives of 1 million out of work people? Remember we were supposed to be a service economy? What services? Banking services. When you hear they talk about a service economy, it means Wall Street not some laid off guy in Pittsburgh or Raleigh who somehow can learn a skill that some guy in India wants to buy. How can a guy in Cleveland do a service for the guy who took his job in Korea? At the bottom of this is a moral question. Should we destroy our jobs to give others a job in another nation? I say no. I say if we want to help those poor people, let them create their own national industries and sell to themselves and compete on the global market for exports. But what we did was turn the whole world into a few corporations who don't give a damn about any nation, they just want money. That is the essence of this baloney and Ross Perot was the only one who called them on it.
     
  19. EatTheRich

    EatTheRich President

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    If Rome was a cruel empire that exploited the masses to serve a debauched plutocracy, and the tribal Germans conservators of the ancient ways of democratic decision-making, limited economic inequality, and women's rights, why did Germans try to become Roman citizens or even sell their own children into slavery in Rome? You may as well ask, if prostitution exploits women, why do women become prostitutes? The U.S. has been plundering other nations--literally--for more than 150 years, and has become the most powerful empire in the world's history, and in absolute terms the richest. It has spent more than 50 years trying to sabotage Cuba, including multiple bombings, strafings, assassination attempts, and biological weapons attacks. And we're supposed to be impressed that Cuba--a country with few natural resources--has not, while maintaining the world's highest ratio of humanitarian aid to GDP, caught up to the U.S. in wealth?
     
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  20. EatTheRich

    EatTheRich President

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    I say at bottom there is one kind of job--a workers' job. And the biggest thing that matters about that job is whether it's a union job or a nonunion job. Not whether it's an American job or an Indian job or a Korean job. If we have strong labor federations, backed by the power of workers' parties and states, we can have good union jobs for people everywhere and end this nationalist race to the bottom that is a prelude to war.
     
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