Comments on: G-20 Meeting: Free Trade at Center of Agenda

By: Harrison

Harrison — Thu, 24 Sep 2009 01:28:27 +0000

There will be plenty of manufacturing left, don’t worry.

By: admin

admin — Wed, 23 Sep 2009 23:39:39 +0000

Harrison,
As you correctly stated, the Chinese now hold billions of dollars (if not trillions) of U.S. Government bonds that were printed by the Treasury Department to pay for America’s decades-long spending binge. As the U.S. dollar continues to get further diluted by deficit spending, its value will erode and interest rates will skyrocket. We simply cannot afford to spend our way out of economic problems without creating hyper-inflation. I suppose that when there are no more U.S. manufacturing jobs left in America due to unrestricted foreign imports the spending binge will have to end because the country will have nothing left to sell, and U.S. government debt will be worthless.

By: admin

admin — Wed, 23 Sep 2009 23:25:18 +0000

Tamara,
You are right in saying that people need to take control of their spending habits. I think that the recession has been an eye-opener for many Americans, who are now concentrating more on paying off debt and less on purchasing consumer goods. When the recession is over, this country needs to strike a healthier balance between saving and spending.
The problem with completely free trade (i.e. no tariffs) is that countries such as China, or Mexico, or Indonesia can produce and export goods cheaply by exploiting their own labor markets. Yes, we in America benefit from lower prices, but in the long run it can destroy our domestic industries who are unable to compete.

By: Harrison

Harrison — Wed, 23 Sep 2009 20:11:37 +0000

China owns too many US dollars and one word from their central bank would drop the dollar faster than a lead brick. Don’t expect much.

And you forget foreign investments in the US such as Honda, Toyota, Volkswagen, BMW, and Mercedes-Benz just to name a few.

Not being able to buy foreign goods also means not being able to sell American goods.

You also need to consider that many companies “ship” jobs overseas because of the government red tape we have in the US. You also fail to see that simple goods that require little quality control or skill, such as shoes, are not cost effective if made in the US but if you look at companies such as Caterpillar Construction you will see that a majority of their sales happen overseas… mainly in China. If you raise tariffs on Chinese goods Caterpillar, and other companies like it, will get killed. In fact, the CEO of Caterpillar was on 60 Minutes slamming the Obama administration for its trade policies.

By: Tamara Hellgren

Tamara Hellgren — Wed, 23 Sep 2009 20:05:37 +0000

Hear, hear! Consumers also need to take responsibility for how they vote with their dollar, and put a little more thought into their purchases of things like clothing, shoes, and other items. For example, does anyone really need another $8 novelty t-shirt from Wal-mart (or similar)? We need to take stock of what we own, buy quality not quantity, care for our things, and take a little time to scout out items made in the U.S.A.

Probably no-one will want to hear messages like this right now, but I’m hoping that this recession, apart from the inevitable anxiety it produces, will inspire people to take control of their spending habits and be more thoughtful. Not only for economic reasons like the ones you wrote about in this post, but because often the reason foreign goods are so cheap is because they were manufactured by, essentially, slave labor and with no regard for the environmental consequences of the manufacturing process (textiles, especially synthetics, with all the dyes and chemicals are big-time offenders).

I have a feeling that I’m preaching to the choir here, but thanks for letting me throw my two cents down anyway!