Thursday, August 26, 2010

Trade Deficit Defined

This issue is an American problem.  Therefore if you are an American citizen, this is YOUR problem.  One of the largest issues we are facing at this point is the Trade Deficit.  What is a Trade Deficit you ask?  Quite simply a Trade Deficit is where the exports don't equal the imports.  For example: if America's exports are less then the imports (i.e. American made products exported are lower or less than a foreign country's  products imported) then you have the current Trade Deficit facing Americans.  This boils down to we are consuming more from outside the country then we produce to ship out of our country.  We need balance.  Therefore we need to sell the rest of the world our goods.  Therefore we need to produce more goods.  But guess what?  We charge too much for our goods because we demand a better quality of life.  Therefore it costs more to produce in our own country then outside of it, say like China.  The average Chinese worker brings home the equivalent of $10 per week.  But because their cost of living is much lower they can afford it.  But what they can not afford to buy are American made products.  So there you have it, folks.  The definition of Trade Deficit in a nut shell.

So what can we do about this?  Stop buying foreign goods and start buying American made, or domestic, goods is a start.  Secondly, and probably most important in this country, tell your government to give incentives to domestic companies to make goods on our own soil.  Let them know that we need to bring our goods back home and not to rely on foreign countries to do the work for us.  There is a catch to that, however.  We need to buy our country back from everyone else.  How do we do that?  Buy U. S. Savings and Treasury Bonds.  It's the same thing that other countries own of ours.  In fact it is the very selling off of your country that gives us money to fund many of our programs such as Medicare and Social Security.  That multibillion dollar bailout?  Bonds sold to other countries.  This will do at least two things.  One, it will ensure a savings for your future and secondly it will put U. S. dollars back into your government to pay for the services that we have enjoyed for many years.  We had to do this during WW I and II.  Lastly it will also tell our government that we want to keep our country and keep it free.  Don't fool yourself.  War does not have to be won or decided over guns and bombs.  We did it to Britain and France in the 1950's.  We threatened to recall on all the debts owed to us from Britain and France.  We won.  Next time it might be China or Japan calling in on our debts to them.  Why do you think that OPEC has so much control over us?  And what happens when the oil dries up?  We will have to pay up and we can not afford that.

I hope you at least start to become as enlightened as I did to what is an American issue.  It matters not who you are, as long as you are an American citizen THIS IS YOUR PROBLEM TOO!

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