ABC:
SECOND: The term "trade deficit" IMPLICITLY asserts that the GOODS - (or goods and services) - are WORTHLESS, which is UTTERLY RIDICULOUS. When a USA gasoline company buys 1 billion dollars worth of OIL from an overseas supplier, they have traded ONE BILLION DOLLARS in cash for ONE BILLION DOLLARS WORTH OF OIL, (OIL THAT THEY WILL REFINE AND MAKE A PROFIT ON); therefore, this PURCHASE - (one which Conventional Wisdom asserts "adds" to the so-called "trade deficit") - is IN PERFECT BALANCE; (REPEAT: the seller has traded goods for money - IOW: traded a "goods asset" for a cash asset; the buyer will probably turn their newly acquired goods asset into a PROFITABLE SALE). This even-steven TRADE can in no way be logically construed as a deficit, or anything bad for the economy of the USA.
The trade deficit is rising again after two months of declines, pushed by oil prices and a flood of imports from China. Analysts warned that global oil prices above $70 per barrel will swell the deficit more in coming months.The Commerce Department reported Friday that the gap between what the United States sells abroad and what it imports rose to $63.4 billion in April, 2.5 percent higher than the March imbalance of $61.9 billion.FIRST: It's RIDICULOUS to argue that ANY nation should buy the same amount of goods - or goods and services - as it sells overseas. Therefore the expectation that trade should always be in balance or that balance is best is stupid.
SECOND: The term "trade deficit" IMPLICITLY asserts that the GOODS - (or goods and services) - are WORTHLESS, which is UTTERLY RIDICULOUS. When a USA gasoline company buys 1 billion dollars worth of OIL from an overseas supplier, they have traded ONE BILLION DOLLARS in cash for ONE BILLION DOLLARS WORTH OF OIL, (OIL THAT THEY WILL REFINE AND MAKE A PROFIT ON); therefore, this PURCHASE - (one which Conventional Wisdom asserts "adds" to the so-called "trade deficit") - is IN PERFECT BALANCE; (REPEAT: the seller has traded goods for money - IOW: traded a "goods asset" for a cash asset; the buyer will probably turn their newly acquired goods asset into a PROFITABLE SALE). This even-steven TRADE can in no way be logically construed as a deficit, or anything bad for the economy of the USA.
The concept of TRADE DEFICIT is an entirely false one, contrived long ago by anti-trade partisans in order to demagogue trade by ginning up fear - by deliberately misconstruing an even-steven trade into a "loss". As PJ O'Rourke so brilliantly argued:
More HERE and HERE and HERE and HERE.
"... there is no such thing as a trade imbalance. Trade can't be out of balance because a balance is what a trade is. Buyers and sellers decide that one thing is equivalent to another. Free trade is balanced trade. You might as well have free love then claim your partner had sex but you didn't."If the MSM were objective, then they'd stop using this propagandistic and misleading number. But the MSM is not objective; the MSM is Left-wing, and anti-free trade/anti-globalism.
More HERE and HERE and HERE and HERE.
3 comments:
To name but three--one an ex Reagan cabinent member--Paul Craig Roberts---along with Cong. Duncan Hunter and Pat Buchanan, there are
many on the Right who oppose and opposed globalism,free trade,Nafta
and excessive trade deficits. I
suggest AB check PC Roberts columns for concise statistics and arguments,fervently written in tones of fittingly due warning as to how the US is losing economically.
http://www.counterpunch.org/roberts02112006.html
a noteworthy example of recent Roberts well-argued RIGHT-WING "protectionism."
http://www.counterpunch.org/roberts02112006.html
a noteworthy example of recent Roberts well-argued RIGHT-WING "protectionism."
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