U.S. 2002 Trade Deficit Reaches $435.2B

Excite News ^ | 2.20.03

[Toddsterpatriot]

You're thinking is one dimensional. There is such a thing as trade balance, where you have an equal amount of imports and exports. This would be the ideal place to be, not a net importer and not a net exporter.

I noticed you didn't answer my question. Saying a trade balance is best shows how little you understand of economics.

So, where is the list of countries with big trade surpluses and how great are their economies? Japan, Germany? Excuse me while I laugh.

[sixmil]

So, where is the list of countries with big trade surpluses and how great are their economies? Japan, Germany? Excuse me while I laugh.

I don't want a trade surplus, that's why I said balanced trade. No surplus, no deficit, get it? I don't want to be a stagnant export economy like Japan, and I don't want to be an import dependent nation like we are currently becoming. I want the benefits of trade without the downside, that's all.

[Toddsterpatriot]

I don't want a trade surplus, that's why I said balanced trade.

Well, if you don't want it, that must be best for the economy.

The point of this thread was the big trade deficit with China. You know what a trade deficit is, right? We send China little green pieces of paper and they send us computers, CD's, DVD's etc.

Willie is worried that they'll keep our little pieces of green paper and never give them back. If they want to do that, we've got plenty of paper.

If they use that paper to buy stuff from us, you and Willie are happy and American jobs are created. If they use that paper to buy t-bills, they reduce American interest rates which helps the economy and creates American jobs and reduces interest the govt pays to finance the federal deficit.

So, either way, I don't see a problem

Enlighten me, show me the problem.

[Toddsterpatriot]

I don't want to be a stagnant export economy like Japan,

Aha, so it is possible to have a trade surplus and still have a bad economy. Quick, tell Willie. There must be a Jefferson quote that applies.

[sixmil]

The point of this thread was the big trade deficit with China. You know what a trade deficit is, right? We send China little green pieces of paper and they send us computers, CD's, DVD's etc.

So you plan on not honoring those greenbacks for all debts public and private?

Willie is worried that they'll keep our little pieces of green paper and never give them back. If they want to do that, we've got plenty of paper.

Nope.

If they use that paper to buy stuff from us, you and Willie are happy and American jobs are created. If they use that paper to buy t-bills, they reduce American interest rates which helps the economy and creates American jobs and reduces interest the govt pays to finance the federal deficit.

I don't care what they do with the money, I just think we should give them less of it. You however, must be very worried about what they do and don't do since that is part and parcel with your version of free trade.

So, either way, I don't see a problem

Enlighten me, show me the problem.

The problem is that you are investing in everybody else's manufacturing sector. The income gap is growing. Real wages are not growing. People are losing good paying jobs. Mothers have to work instead of staying home raising their kids. You are making a communist country wealthy. You are making us dependent on the rest of the world.

[Toddsterpatriot]

So you plan on not honoring those greenbacks for all debts public and private?

Sure, I'll honor the pieces of paper, all they have to do is buy stuff. If they prefer paper, I guess they could eat it.

The income gap is growing.

Income gap, you sound like Clinton.

Real wages are not growing. People are losing good paying jobs. Mothers have to work instead of staying home raising their kids.

Mothers have to work because the goverment takes half our money, not because China gives us cool stuff for green paper.

You are making a communist country wealthy. You are making us dependent on the rest of the world.

Yeah, China is so wealthy that Americans risk their lives to get smuggled into China everyday, oh wait, Chinese get smuggled here. Nevermind.

[sixmil]

Mothers have to work because the goverment takes half our money, not because China gives us cool stuff for green paper.

Yeah, China is so wealthy that Americans risk their lives to get smuggled into China everyday, oh wait, Chinese get smuggled here. Nevermind.

And why is it that gov't takes half our money? Because they no longer collect tariffs. You do realize that the gov't used to fund itself almost entirely through tariffs. Tax-cut Republicans like you have a single solution for all that ails us, tax cuts. Find a tax and cut it, problem solved. And it's a perpetual power source too since Dems will raise taxes, and then you get to go cut them again. Is it ever necessary to accomplish anything tangeable or is does the rhetoric justify itself? You need to learn to read more carefully. I said we are making the Chinese wealthy, not the Chinese are wealthy.

[Toddsterpatriot]

And why is it that gov't takes half our money? Because they no longer collect tariffs.

Yeah, if only we lived in the 1800's and the government was funded only thru tariffs.

Tax cuts aren't the solution for everything, but neither is the government. If we ever cut government to where it should be (much less than 20% of GDP) then maybe we could fund it with tariffs alone. I'd be willing to cut income taxes to zero and try that.

Yes, we're making the Chinese wealthy,

The result has been a quadrupling of GDP since 1978. In 2001, with its 1.27 billion people but a GDP of just $4,300 per capita, China stood as the second largest economy in the world after the US. At this rate of growth, by 2024 they'll be up to $17,200 per capita.

The US has the largest and most technologically powerful economy in the world, with a per capita GDP of $36,300.

They still have a long way to go.

http://www.cia.gov/cia/publications/factbook/geos/ch.html

[getsoutalive]

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%.

Not sure where you get your data from but, economagic.com has '02 GDP at about $9.5T and yoy growth at 2.75%

If my math is correct that would put the $435B trade deficit at approx. 4.6% of GDP.

[sixmil]

Yeah, if only we lived in the 1800's and the government was funded only thru tariffs.

Are you suggesting that the system did not work then, or that it won't work now?

Tax cuts aren't the solution for everything, but neither is the government.

So tariffs are big government, but trade deals are not?

The result has been a quadrupling of GDP since 1978. In 2001, with its 1.27 billion people but a GDP of just $4,300 per capita, China stood as the second largest economy in the world after the US. At this rate of growth, by 2024 they'll be up to $17,200 per capita.

Sounds like you are suggesting that China is not a threat until they are equal to us in per capita GNP. Did you make the same argument with respect to the Soviets during the cold war?

[Toddsterpatriot]

Are you suggesting that the system did not work then, or that it won't work now?

I suggested no such thing. You get government spending down to 10% of GDP and I'll support tariffs to finance the spending. As long as income tax is eliminated.

Tax cuts aren't the solution for everything, but neither is the government.

So tariffs are big government, but trade deals are not?

Tariffs which raise costs to consumers and give the government more money would be big government, yes.

The result has been a quadrupling of GDP since 1978. In 2001, with its 1.27 billion people but a GDP of just $4,300 per capita, China stood as the second largest economy in the world after the US. At this rate of growth, by 2024 they'll be up to $17,200 per capita.

Sounds like you are suggesting that China is not a threat until they are equal to us in per capita GNP. Did you make the same argument with respect to the Soviets during the cold war?

I was never worried about the GDP of the Soviets. I'm worried about the Chinese, sure, but because they're aggressive and expansionist. Their military will be a problem, eventually. No argument there.