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If the imports we currently get from China move elsewhere, the US economy is still in the same situation--an over abundance of imports vs. exports. It would affect the job market abroad, but getting items from somewhere else wouldn't affect the issue in the U.S. Neither, in my opinion, would a re-evaluation of the RMB, though it would be nice for my bank account. :)

As for the fears of China's export-based economy, I personally believe its too early to tell. True, manufacturing in China is certainly not the same as consumption. But the same thing could have been said about Japan thirty years ago, but their export-dominated strategy kicked up internal consumption. Unfortunately for them, they held on to that strategy too long, with the current results. It is very possible that the same thing will happen in China--it'll spur domestic consumption, but will result in an eventual economic downturn. The Chinese property market is already riduculously overpriced.

I think that it is too early to judge whether China's size will affect the out come. You seem to think it will, but I'm not convinced.

If the imports we currently get from China move elsewhere, the US economy is still in the same situation--an over abundance of imports vs. exports.

Not nessesarily. Not all trade relations are created equally. Likewise, not all countries are in the same internal economic funk as China.

Historically if we imported $1 worth of products from Mexico we exported 75 cents.

With China its $1 for every 15 cents.

Other economies around the world are much easier to come alive and create demand. It would most definately create demand for exports if we focus on those economies. It would have several effects.

1. American companies can compete a whole lot better against Mexican manufacturing, etc. In some cases they still won't be able to, this is due to real competitive advantage. China currently is taking investments in things they don't have a real competitive advantage in...They make their own advantage visa via currency manipulations.

2. Spreading the volume of trade over more responsive economies will lead to MANY more exports from the US to those countries.

In short when we combine #1 and #2, we will burn the trade deficit candle on both ends... and even if we don't decrease the overall amount of imports, we will increase our overall level of exports.

Its not JUST about China's size. It has an effect, but things rely on China's internal economy too.

China's internal economy is half defunct. It could be the level of development or many other things, but none the less a million bucks imported from Mexico leads to approximately 5 times the amount of exports the same amount creates in China.