Beggaring Thy Neighbor Robbing Joe To Pay Chan

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China is robbing Joe to pay Chan

 

But every trade deficit pales compared to the current one with China….

 

The U.S. trade deficit in goods with China for 2012 was all-time record - $315 billion. China exports over six times as much in manufactured goods to the United States, $417 billion’s worth, as the U.S. exports to China.

 

“So it is now that by reason of the abundance of foreign wares brought into this realm from the parts of beyond the seas, the said artificers are not only less occupied, and thereby utterly impoverished … [but] divers cities and towns within this realm greatly endangered, and other countries notably enriched.”  British Protectionist Act of 1562

 

The Chinese government, in an effort to maximize exports and minimize US imports, prints their Yuan to buy dollars. This prevents their currency from rising and the dollar from falling.

 

According to Tyler Duran over at zerohedge.com China pumped $11 trillion into its economy between January 2005 and January 2013. The amount of newly increased money supply peaked in 2012 hitting US$4.1 trillion (over 26 trillion yuan), with China accounting for almost half.

 

China also:

  • Puts in place purchasing restrictions
  • Permits piracy
  • Permits cyber industrial espionage
  • Delays legitimate items from entering the country
  • Provides massive direct subsidization of export production in many key industries
  • Maintains strict non-tariff barriers to imports

 

xe.com

 

Many estimate China's currency is undervalued by up to 40 percent. An undervalued yuan means that Chinese products are cheaper for U.S. consumers but American products cost more for Chinese consumers.

 

For goods, total U.S. 2012 exports were $1,563.6 billion and imports were $2,299.3 billion, which means America’s overall trade position in 2012 was a global trade deficit in goods of $736 billion – that’s five percent of the U.S. economy.

 

If the goal is to revive the U.S. economy by a planned currency devaluation driving export and job numbers higher it’s not working. Nor will it by printing more dollars. Every country that exports into the United States has a printing press (a computer keyboard) and will use it.

 

Income and Jobs

 

“This Heritage Foundation analysis shows that over half a million American jobs are supported by imports of clothes and toys from China alone. These jobs are in fields such as transportation, wholesale, retail, construction, and finance. Understanding the positive role of imports with respect to jobs, in addition to their other benefits, is critical to adopting the correct trade policy and thus to bolstering the economy.”  Trade Freedom: How Imports Support U.S. Jobs, By Derek Scissors, Ph.D., Charlotte Espinoza and Ambassador Terry Miller

 

According to the Federal Reserve's Survey of Consumer Finances, from 2007 to 2010, a typical US family lost 39 percent of its wealth - in 2007, the median family net worth was $126,400, in 2010, it was $77,300.

 

From 2000 to 2011, median income for working-age households fell from $63,535 to $55,640, a decline of $7,895, or 12.4 percent.

 

Median household income declined by 1.5 percent to $50,054 in 2011 from $50,831 in 2010. Median income in 2011 was down almost nine percent from the recent peak in 1999.

 

Income inequality, between 2010 and 2011, increased as mea­sured by changes in the shares of aggregate household income by quintiles, the Gini index, the Theil index, and the Atkinson measures. The Gini index showed a 1.6 percent increase from 2010. Since 1993, the Gini index is up 5.2 percent.

 

U.S. overall workforce participation rate looks dismal.


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