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U.S. 2002 Trade Deficit Reaches $435.2B
Excite News ^ | 2.20.03

Posted on 02/20/2003 9:31:20 AM PST by Enemy Of The State

 

U.S. 2002 Trade Deficit Reaches $435.2B
 
Feb 20, 11:04 AM (ET)

By MARTIN CRUTSINGER

(AP) The chart tracks the Leading Economic Indicators for the past year. (AP Graphic)
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WASHINGTON (AP) - The United States recorded a $435.2 billion trade deficit for 2002, the largest imbalance in history, as the weak global economy set back American exports while imports of autos and other consumer goods were hitting all-time highs.

In other economic news, the Labor Department reported Thursday that inflation at the wholesale level shot up by 1.6 percent in January, the biggest increase in 13 years, led by a sharp 4.8 percent rise in energy costs.

Even though the surge was concentrated in energy, prices of other items such as new cars showed big advances as well and the overall increase was certain to raise concerns about whether inflation, which has been well-behaved for years, was threatening to get out of control. The government will report on January consumer prices on Friday.

In a third report, the government said that the number of newly laid off workers filing unemployment claims jumped to a seven-week high of 402,000 last week, up by 21,000 from the previous week, showing that the labor market is still struggling with an uneven economic recovery.

 

The trade report showed that even in agricultural products, normally a U.S. bulwark, Americans bought more imported wine, cheese and other foods than American farmers were able to sell abroad - resulting in only the second U.S. trade deficit in farm goods on record.

The Commerce Department reported Thursday that the deficit for all of last year was up 21.5 percent from the $358.3 billion trade gap recorded in 2001 and surpassed the old record deficit of $378.7 billion set in 2000.

By country, the United States ran up the largest trade gap with China, a deficit of $103.1 billion, marking the third straight year that the United States has recorded its largest trade deficit with that nation. It pushed the former front-runner in this category, Japan, into second place.

In addition to the record for all of 2002, the United States set a new monthly high of $44.2 billion in December, up 10.5 percent from the previous record set in November of $40.0 billion.

Opponents of President Bush's trade policies contend that the huge trade deficits represent the loss of millions of manufacturing jobs as U.S. companies have been battered by what the critics say is unfair competition from low-wage countries that stifle labor rights and have lax environmental protections.

 

(AP) The nation's unemployment rate unexpectedly dropped to 5.7 percent in January as businesses added...
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However, the administration contends that it is pursuing the correct procedure in trying to cut global trade deals that will lower high barriers in other countries in a way that boosts American exports.

American manufacturing companies have been lobbying for the Bush administration to drop its support for a strong dollar policy, arguing that an overpriced dollar has made their goods noncompetitive in foreign markets while opening them to a flood of competition from cheaper priced imports.

Treasury Secretary John Snow, who was meeting with British finance officials on Thursday on his way to a weekend meeting in Paris of America's major economic allies, insisted during his Senate confirmation hearing that the administration intends to make no change in its strong dollar policy. A strong U.S. dollar makes investments in U.S. stocks and bonds more attractive to foreigners.

For 2002, exports of goods and services fell 2.5 percent to $973 billion, marking the second consecutive annual decline, as American exporters found it increasingly difficult to sell overseas. This reflected a spreading global economic slowdown and the strong dollar.

American manufacturers were the hardest hit sector of the economy during the 2001 recession with a loss of nearly 2 million workers. While the economy began a recovery in 2002, the progress has been uneven and so far it has not resulted in a rebound in hiring.

American imports, which fell 6 percent in 2001, reflecting the U.S. recession, staged a rebound in 2002, rising by 3.8 percent to $1.41 trillion. That, however, was still below the all-time high of $1.44 trillion set in 2000.

But in individual categories, imports of autos and auto parts set a record high $203.9 billion and imports of other consumer goods, a category that includes everything from clothes to televisions and toys, also hit a record high of $307.7 billion last year.

Imports of oil totaled $103.6 billion last year, basically unchanged from the level in 2001.

After China, deficits with other countries included imbalances of $$70.1 billion with Japan; $49.8 billion with Canada and $37.2 billion with Mexico.

On the export side, manufactured goods suffered a setback but sales of American farm products managed to eke out a tiny 0.3 percent increase to $49.54 billion last year over the 2001 level.

However, imports of farm products rose a much faster 6.6 percent to $49.72 billion, representing in a deficit in farm trade of $176 million, the second such deficit in history. Farm imports topped exports in 1986 as well.



TOPICS: Business/Economy; Crime/Corruption; Culture/Society; Foreign Affairs; Front Page News; Government; News/Current Events; Politics/Elections
KEYWORDS: globalism; recession; thebusheconomy
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1 posted on 02/20/2003 9:31:20 AM PST by Enemy Of The State
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To: Enemy Of The State
Direct result of soft money bribery directly or indirectly paid by China.
There is no reason we should have a trade imbalance with them if we both have open markets and they aren't stealing our technology.

The only reason we do is because they bribe our politicians both Democrats and Republicans. They Bribed Clinton directly. Now they are a little more sophisticated about it. They bribe Bush though companies that they do business with.
2 posted on 02/20/2003 9:42:36 AM PST by stalin
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To: Enemy Of The State
Related thread: Bush Touts His Economic Plan in Georgia

``I agree with Zell, with this economic theory that when a person has more money in his pocket, they're likely to demand that somebody produce them a good or a service,'' he said.

Bush ignores the economic reality that undermines his economic "stimulus" plan: U.S. trade deficit hit record $435.2 billion in 2002

Any "trickle down effect" normally associated with tax cuts is quickly diverted overseas.
American taxpayers are subsequently mired deeper in debt. Government Hits $6.4 Trillion Debt Limit

Dubya's lack of fiscal responsibility will weaken our nation and lead to his political defeat in 2004.

Like his father, ol' Juanterm is economicly clueless, even when current headlines hit him square in the face.

3 posted on 02/20/2003 9:46:07 AM PST by Willie Green (Go Pat Go!!!)
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To: Willie Green
Any "trickle down effect" normally associated with tax cuts is quickly diverted overseas.

So the government shouldn't cut my taxes because I might spend my own money on a foreign product?

4 posted on 02/20/2003 9:56:27 AM PST by Toddsterpatriot
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To: stalin
The only reason we do is because they bribe our politicians both Democrats and Republicans. They Bribed Clinton directly. Now they are a little more sophisticated about it. They bribe Bush though companies that they do business with.

The "Two-party Cartel" at their best. And the sheeple will vote the same ones in the next election. 80% want the borders secured. Good luck, sheeple. but vote them back in next time. BTW, Hillary is talking about closing the borders. If so, her stock went up a bunch.

5 posted on 02/20/2003 10:00:11 AM PST by Digger
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To: Willie Green
Those exploding American exports that free traders keep promising us have never materialized, and will never materialize because we are producing less and less and consuming more and more. The net effect of this is that we are transferring our wealth to foreign nations through two high-powered hoses, capital investment in foreign labor and consumer spending of foreign production, and one fine day the national credit card is going to hit its limit.

When that happens, look out. You'll see a regime change here that would make the Bolshevik revolution look like a picnic. Say goodbye to the Constitution, hello to the New World Order. Then again, this is what the radicals who push free trade down our throats want - a global system of command and control. Once our industry is entirely emasculated, there will be nothing left of us to fear. Empire is approaching both its apogee, and its last gasp.

This trade deficit is serious stuff. Free traders can poo-poo this all they want, but watch and see for yourself. It is only a matter of time. The result is pre-ordained by the laws of economics.

6 posted on 02/20/2003 10:04:59 AM PST by Publius Maximus
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To: Toddsterpatriot
So the government shouldn't cut my taxes because I might spend my own money on a foreign product?

There comes a time when you (as a citizen) have to own up to your financial responsibilities and obligations. Debts must be paid, unless you think declaring National Bankruptcy is going to save your sorry butt.

7 posted on 02/20/2003 10:04:59 AM PST by Willie Green (Go Pat Go!!!)
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To: Willie Green
A wise policy would be to encourage domestic production for domestic consumption - that's Adam Smith 101. Impose an ad valorum tariff on all articles of foreign manufacture, and remove all taxes on individual income and investment. This would necessitate maintaining a MUCH SMALLER federal budget, sufficient to pave our roads and fund our military, but not much else. But the economic boom would be unbelievable, and nobody would miss all those unemployment benefits.

Unfortunately it is going to take the nation going through bankruptcy to realise the wisdom of the tariff revenue system that our Founders created, and which made us rich and independent for the first 150+ years of our republic. The tax-and-spend empire, constructed by the two party duopoly in this century, is on a collision course with reality.

8 posted on 02/20/2003 10:12:55 AM PST by Publius Maximus
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To: Publius Maximus
A wise policy would be to encourage domestic production for domestic consumption - that's Adam Smith 101.

Amen!

The Road to Productive Wealth

The only true key to wealth lies in production. While you can increase your own wealth at the expense of others, we all become wealthier when productive resources are increased. Greater wealth for our economy lies in increasing the quantity or quality of productive resources -- labor, capital, and natural resources. This is done by investing in education, capital goods, research and development, and technology.

Fundamentally, we believe that the U.S. government needs to devote more resources and put in place new programs to build wider expertise about China and to protect our industrial base from eroding as a result of our economic relations with China.

-- C. Richard D’Amato, chairman
U.S.-China Security Review Commission
(How to improve U.S.-China relations )


9 posted on 02/20/2003 10:16:20 AM PST by Willie Green (Go Pat Go!!!)
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To: Digger
I've got to agree with you. It's unfathomable why people keep voting for corrupt consummate party lap dogs over and over again. Sheeple is right.

80% want our borders secure but most of the sheeple on this site and elsewhere will go ahead and vote for a guy that wont do that.
10 posted on 02/20/2003 10:18:46 AM PST by stalin
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To: Publius Maximus
Great post Publius !!!! I'm going to cut it and past it on a note pad for future reference.
It's nice to see a clear headed no holds bared thinker on this site. Look out they'll suspend your posting privileges if you get to close to the Truth.
11 posted on 02/20/2003 10:23:41 AM PST by stalin
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To: Willie Green
The only true key to wealth lies in production.

According to free market economics, there is ONE single determinant of standards of living in a nation: The per capita capital investment in domestic labor.

The things you quote - education, capital goods, R&D, technology - are all in line with that.

Every policy, not just economic policy, needs to be run through a single minded filter: Will it increase or at least not decrease per capita capital investment in domestic labor? And if it would tend to depress such investment, such policy ought to be rejected outright.

Free trade (i.e., division of labor) without the rights and responsibilities of statehood ought to be rejected outright.

12 posted on 02/20/2003 10:26:10 AM PST by Publius Maximus
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To: stalin
The American Conservative is going to be publishing a few of my articles soon. The first one will be Will the Real Adam Smith Please Raise Your (Invisible) Hand?, in which I skewer the modern free trade interpretation of Smith's Invisible Hand passage. Look for it in the next issue or two.
13 posted on 02/20/2003 10:29:57 AM PST by Publius Maximus
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To: Enemy Of The State
A question, not explicitly stated, has been posed -

What is the value of the intellectual property consolidated and engineered in the US, then sent out to a foreign manufacturing facility for construction, and brought back to the US for sale?

Of course, the foreign manufacturing facility can simply steal, or reverse-engineer, the technology that is exported, and set up their own competing intellectual property, selling it outside the US and undercutting the direct exports from the US. East Asia has been doing this for years (Japan, South Korea, Singapore, China et al). Is our only recourse to produce more and more advanced technology faster than the foreign competition?
14 posted on 02/20/2003 10:37:37 AM PST by alloysteel
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To: Publius Maximus
"This trade deficit is serious stuff. Free traders can poo-poo this all they want, but watch and see for yourself. It is only a matter of time. The result is pre-ordained by the laws of economics."

Ez ussuns uz seyin down by de sawmill jes de odder day, dis heah depressun comin up gwine be a lot wussa dan de lassun cuz mos folk doan know nuttin bout cookin no possum nowdays.
Mercy on a poor boy. I think the waste matter is about to interface with the blades of the air moving machine.
15 posted on 02/20/2003 11:01:23 AM PST by RipSawyer
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To: Publius Maximus
Those exploding American exports that free traders keep promising us have never materialized

You don't know what you're talking about. Exports keep going up.

16 posted on 02/20/2003 11:02:36 AM PST by lasereye
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To: Willie Green
We got into a service vs. manufacturing argument a year ago, but here we go again. An auto company manufactures autos from steel, plastic and other stuff. An auto repair shop manufactures a working auto from a non working auto. A doctor manufactures a working human from a non working human. McDonalds manufactures cooked food from non cooked food. A laundry manufactures clean clothes from dirty clothes. A shirt factory manufactures clothes from cotton. A snowplow manufactures a drivable road from a non drivable road.

My point is that I don't find a huge difference between services and manufacturing.
17 posted on 02/20/2003 11:02:44 AM PST by staytrue
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To: Willie Green
You seem to be linking the budget deficit to trade deficits. What are you saying the link is? Are you saying if we increase taxes the trade deficit would decline? And if so, why?
18 posted on 02/20/2003 11:05:33 AM PST by lasereye
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To: staytrue
My point is that I don't find a huge difference between services and manufacturing.

Sounds like you wasted a full year of your life without learning anything. That's a shame.

WEALTH: The net ownership of material possessions and productive resources. In other words, the difference between physical and financial assets that you own and the liabilities that you owe. Wealth includes all of the tangible consumer stuff that you possess, like cars, houses, clothes, jewelry, etc.; any financial assets, like stocks, bonds, bank accounts, that you lay claim to; and your ownership of resources, including labor, capital, and natural resources. Of course, you must deduct any debts you owe.

VALUE ADDED: The increase in the value of a good at each stage of the production process. The value that's being increased is specifically the ability of a good to satisfy wants and needs either directly as a consumption good or indirectly as a capital good. A good that provides greater satisfaction has greater value. In essence, the whole purpose of production is to transform raw materials and natural resources that have relatively little value into goods and services that have greater value.

SERVICE: An activity that provides direct satisfaction of wants and needs without the production of a tangible product or good. Examples include information, entertainment, and education. This term good should be contrasted with the term good, which involves the satisfaction of wants and needs with tangible items. You're likely to see the plural combination of these two into a single phrase, "goods and services," to indicate the wide assortment of economic production from the economy's scarce resources.

Wealth is created only by engaging in value-added activities. By the same token, Service sector activities do not create wealth, they merely transfer, redistribute and eventually dissipate wealth as consumption. Thus, as value-added activities move offshore and the U.S. labor force shifts to the Service Sector, wealth is dissipated, not created. And the U.S. standard of living declines as a result.
19 posted on 02/20/2003 11:14:44 AM PST by Willie Green (Go Pat Go!!!)
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To: Enemy Of The State
later reading
20 posted on 02/20/2003 11:17:35 AM PST by liberallarry
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To: lasereye
You seem to be linking the budget deficit to trade deficits. What are you saying the link is? Are you saying if we increase taxes the trade deficit would decline?

I'm saying that the economic stimulative effects normally associated with tax cuts by the "trickle down effect" are siphoned away from our domestic economy by the trade deficit.

This can be rectified by shifting the source of federal revenue from excessive dependence on corporate and individual income taxes to imposing a flat revenue tariff on ALL imported goods. Increasing tariffs in conjunction with lowering other forms of federal taxation will redirect the trickle down effect back into our domestic economy.

21 posted on 02/20/2003 11:23:39 AM PST by Willie Green (Go Pat Go!!!)
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To: Willie Green
There comes a time when you (as a citizen) have to own up to your financial responsibilities and obligations.

If you're talking about foreign products I've bought, I paid when I bought them.

Debts must be paid, unless you think declaring National Bankruptcy is going to save your sorry butt.

If you're talking about the National Debt, I vote we cut government spending. Is my butt saved?

22 posted on 02/20/2003 11:28:00 AM PST by Toddsterpatriot
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To: Toddsterpatriot
If you're talking about the National Debt, I vote we cut government spending. Is my butt saved?

Your share of the National Debt is $22,178.02. (U.S. NATIONAL DEBT CLOCK)
If you're married, your wife owes the same amount.
If you have children or other dependents, they each owe the same amount as well.

Cough it up.

23 posted on 02/20/2003 11:37:44 AM PST by Willie Green (Go Pat Go!!!)
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To: Willie Green
Wealth is created only by engaging in value-added activities. By the same token, Service sector activities do not create wealth, they merely transfer, redistribute and eventually dissipate wealth as consumption. Thus, as value-added activities move offshore and the U.S. labor force shifts to the Service Sector, wealth is dissipated, not created. And the U.S. standard of living declines as a result.

OK, you think the best economy would be closer to 100% manufacturing than 100% services. You also think that the trade deficit is bad.

So, what countries have the largest trade surplus? Are their economies better than ours? Are their citizens better off than ours?

24 posted on 02/20/2003 11:41:50 AM PST by Toddsterpatriot
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To: Willie Green
Your share of the National Debt is $22,178.02. (U.S. NATIONAL DEBT CLOCK) If you're married, your wife owes the same amount. If you have children or other dependents, they each owe the same amount as well.

Cough it up.

Take it out of my share of the federal lands. After we sell them off, I'll cough up my share of the remaining debt.

25 posted on 02/20/2003 11:43:11 AM PST by Toddsterpatriot
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To: Willie Green
Examples include information, entertainment, and education.

Here we go again part 2. Education manufactures an educated person from a non educated person. For example education can take someone and turn him into a scientist, a doctor, an auto repair guy etc. That is as valuable as taking cotton and making a shirt out of it. Entertainment manufactures an entertained person out of a unentertained person. This is also valuable as "all work and no play makes jack a dull boy" Just ask the military if entertainment has no value to troop moral or efficiency. Information is much like education in that it manufactures a more effective use of resources from less effective use of resources. Information helps you design and manufacture stuff. Information allows for better more effective drugs. Information may be the difference between a dosage of drug that is ineffective (too little), lethal (too much) or curative (just right). Information is also as important as manufacturing. It is probably essential to manufacturing.

26 posted on 02/20/2003 11:46:29 AM PST by staytrue
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To: Toddsterpatriot
Take it out of my share of the federal lands. After we sell them off, I'll cough up my share of the remaining debt.

So you propose we sell Alaska and ANWR to China?
How lazy and shortsighted of you, but not surprising.

27 posted on 02/20/2003 11:47:58 AM PST by Willie Green (Go Pat Go!!!)
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To: Enemy Of The State; Willie Green; AdamSelene235; Nick Danger; Dog Gone
No doubt the gloomsters are hyping this "record" trade deficit, but more sensible people might be able to discern that $436 Billion is only 3.6% of our annual $12 Trillion economy, or slightly less than Americans tip waitresses each year for our meals.

Oooh, now there's an economy-killer! < /kidding! >

28 posted on 02/20/2003 11:51:45 AM PST by Southack (Media bias means that Castro won't be punished for Cuban war crimes against Black Angolans in Africa)
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To: staytrue
Here we go again part 2.

There YOU go again.
I'm not going to waste my time on your economicly irrelevant gibberish.

29 posted on 02/20/2003 11:53:00 AM PST by Willie Green (Go Pat Go!!!)
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To: Southack
small beans...

Happy?

30 posted on 02/20/2003 11:53:31 AM PST by AdamSelene235 (Like all the jolly good fellows, I drink my whiskey clear.)
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To: Willie Green
So you propose we sell Alaska and ANWR to China? How lazy and shortsighted of you, but not surprising.

How about we sell it to Americans instead? They'll do something productive with it which will create jobs and increase economic activity.

Any "trickle down effect" normally associated with tax cuts is quickly diverted overseas. American taxpayers are subsequently mired deeper in debt.

You sound like Bill Clinton. "I suppose we could cut your taxes and hope you spend it the right way.

Why don't we double our taxes and then no one will have any money to buy any foreign products?

31 posted on 02/20/2003 11:58:55 AM PST by Toddsterpatriot
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To: Willie Green
Your share of the National Debt is $22,178.02

Current 10yr Treasury rate 3.85%. My share is only costing me $854 a year in interest. I can afford $71 a month.

32 posted on 02/20/2003 12:07:14 PM PST by Toddsterpatriot
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To: Southack
but more sensible people might be able to discern that $436 Billion is only 3.6% of our annual $12 Trillion economy,

Even more sensible people would make the comparison to that portion of our GDP which represents our wealth creating private sector. Watering down the impact with the nonvalue-added service sector and bloated government portions of the GDP merely sidesteps the issue.

33 posted on 02/20/2003 12:11:17 PM PST by Willie Green (Go Pat Go!!!)
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To: Toddsterpatriot
You're ineligible for those rates since you're incapable of paying down the principle.
34 posted on 02/20/2003 12:17:40 PM PST by Willie Green (Go Pat Go!!!)
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To: Willie Green
You're ineligible for those rates since you're incapable of paying down the principle.

Don't know what you mean. My share is $22,178. The government is borrowing on my behalf and currently paying 3.85%. Sounds like that's the rate I'm paying.

35 posted on 02/20/2003 12:20:49 PM PST by Toddsterpatriot
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To: Willie Green
"Watering down the impact with the nonvalue-added service sector and bloated government portions of the GDP merely sidesteps the issue."

I'm unconvinced.

3.6% of our annual GDP is lost in our annual trade deficit. OK, but how much did our economy grow in that same year? 4.7%.

Moreover, I find it difficult to claim that the service sector, such as doctor extending the productive life of a worker, is not adding even the slightest bit of value.

In fact, we could be ramping up production to world-record levels, but if said manufacturing production was all in horse-buggy-whips that no one wanted to buy, then that manufacturing would be a net drag on our economy.

So I remain unconvinced of even "service" jobs as being "valueless" or manufacturing jobs always being the panacea.

Some of each would seem to be the best course, in fact.

36 posted on 02/20/2003 12:21:02 PM PST by Southack (Media bias means that Castro won't be punished for Cuban war crimes against Black Angolans in Africa)
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To: Willie Green
I like trade deficits. We print pictures of our Presidents on pieces of paper at negligible cost, and trade them for High Definition Television sets.

It's a great scam.

37 posted on 02/20/2003 12:29:21 PM PST by Dog Gone
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To: Dog Gone
I like trade deficits. We print pictures of our Presidents on pieces of paper at negligible cost, and trade them for High Definition Television sets. It's a great scam.

Shhh, the godless foreigners will hear you.

38 posted on 02/20/2003 12:31:39 PM PST by Toddsterpatriot
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To: Southack
Moreover, I find it difficult to claim that the service sector, such as doctor extending the productive life of a worker, is not adding even the slightest bit of value.

It's not. Medical services are benefits earned by the productive efforts of the worker. No work, no benefits. And the service sector collapses due to the excessive burden of its own demands.

39 posted on 02/20/2003 12:39:01 PM PST by Willie Green (Go Pat Go!!!)
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To: Willie Green
Any "trickle down effect" normally associated with tax cuts is quickly diverted overseas.

What we have now is trickle down deficits.

40 posted on 02/20/2003 12:47:38 PM PST by FITZ
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To: Willie Green
It's not. Medical services are benefits

When is a service not a service? When it's a benefit. So, are benefit services better or worse than just plain services?

What if a manufactured good is a benefit, like a company car? Is that better or worse than just a regular car?

41 posted on 02/20/2003 12:48:25 PM PST by Toddsterpatriot
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To: Toddsterpatriot
So the government shouldn't cut my taxes because I might spend my own money on a foreign product?

They should cut taxes but they must also cut government spending especially on welfare programs ---I haven't seen any plans of that. Cutting taxes so people can buy foreign products won't help the US economy at all, it won't create a single American job. A tax cut to induce spending helps China even more and makes the trade deficit higher.

42 posted on 02/20/2003 12:49:26 PM PST by FITZ
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To: Toddsterpatriot
What if a manufactured good is a benefit, like a company car?

Makes absolutely no difference if it's unaffordable.
If it's unaffordable, then it'll no longer exist.

43 posted on 02/20/2003 12:53:20 PM PST by Willie Green (Go Pat Go!!!)
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To: Willie Green
Your share of the National Debt is $22,178.02.

What about the welfare class? Is their share the same amount? If so then you'd have to add their share in with those of the working class because the welfare class can't pay theirs.

44 posted on 02/20/2003 12:55:16 PM PST by FITZ
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To: FITZ
What about the welfare class? Is their share the same amount?

It's the same amount for everybody, regardless of class.

If so then you'd have to add their share in with those of the working class because the welfare class can't pay theirs.

Yep, I'm afraid so. Gonna get stuck supporting them one way or the other.
My preference, though, is to downsize government welfare and promote domestic manufacturing to provide the welfare class opportunity to earn their keep.

45 posted on 02/20/2003 1:04:16 PM PST by Willie Green (Go Pat Go!!!)
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To: Southack
So I remain unconvinced of even "service" jobs as being "valueless" or manufacturing jobs always being the panacea.

If you can't "touch" the product, one really hasn't produced any wealth...I believe that was a Marxian theory. A rather narrow view of what constitutes wealth.

GDP only measures final demand of goods and services (Keynsian concept); it misses all of the intermediate stages of production. So the economy could be greatly understated.
46 posted on 02/20/2003 1:12:30 PM PST by Lee_Atwater
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To: FITZ
They should cut taxes but they must also cut government spending especially on welfare programs

I agree completely.

Cutting taxes so people can buy foreign products won't help the US economy at all, it won't create a single American job.

You sound like Clinton, you only like it when people spend money the way you think is best. Whatever happened to freedom?

A tax cut to induce spending helps China even more and makes the trade deficit higher.

So, we should raise taxes? The amount of money spent on Chinese or any foreign good is a relatively small part of the economy (about 11% of GDP). You'd sacrifice the 89% that would be spent on U.S. goods?

A trade deficit isn't automatically bad, a trade surplus isn't automatically good.

47 posted on 02/20/2003 1:16:57 PM PST by Toddsterpatriot
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To: FITZ
Would consumers being "trickled on" be more accurate?....cause that's sure what it feels like!
48 posted on 02/20/2003 1:31:28 PM PST by american spirit
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To: Willie Green
So I take it you've already looked at the 2002 trade figures and you already know where 90+% of our trade deficit lies, right? You've also seen the trend of the past 10 years and realized that our trade deficit shows the relative strength between the US economy and the rest of the world...the deficit shrinks when our economy is weak relative to the rest of the world, and grows when its the opposite. You've seen this, right?
49 posted on 02/20/2003 1:34:47 PM PST by Citizen of the Savage Nation
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To: Publius Maximus
Those exploding American exports that free traders keep promising us have never materialized,

Actually, they have, if you bother to look at the stats. Our exports have more than doubled in the last 10 years but its not our fault our competitors can't afford more because they are socialistic and protectionist.

50 posted on 02/20/2003 1:38:11 PM PST by Citizen of the Savage Nation
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