Sunday, June 05, 2005

Deficits

Apparently the United States is sucking up billions of dollars from developping countries to fund our trade and national deficits. This is neither healthy nor sustainable, and if we are to maintain the world's most competitive economy, we have to do several things.

First, we need a new energy policy to reduce our trade deficit. The best current alternatives to oil (nuclear, clean coal, natural gas, solar, eventually hydrogen) include nearly no foreign imports, redirecting billions of dollars that currently go overseas into the domestic economy.

Second, we need to level the playing field. As it stands right now, we cannot compete with China because it's not playing by the rules. Despite the fact that Americans are up to ten times more efficient then the Chinese, they, and nations like them, hold a large part of our huge trade deficit. It doesn't recognize patents, unfairly pins its currency, and cares nothing for the various workers' rights, health, and environmental regulations. As long as they continue these practices we simply cannot compete. To fix this, we need to enact sweeping trade reform, giving the president the right to impose tariffs on nations that do not abide by the regulations we force our own companies to abide by. Not only is this practical, it is also humane. Why should we protect the environment and provide minimum wages to our own workers just to ship the injustices overseas? Yet even this will not entirely fix the trade deficit.

Finally, we need to do some fixing back here. We need to simplify regulations and taxes, provide our economy with the world's best infrastructure, and heighten our education standards so that our students can outperform those of other nations.

Thus, as it stands, it is the practical policy that through energy reform, trade reform, and internal tweaking our currently dangerous trade deficits might be brought back to our favor.

3 comments:

Jordan said...

so then how do we force china to un-pin their currency?

William said...

Congress is already at it. They're threatening a huge tariff on all Chinese imports if they don't unpeg in the next 6 months. Unfortunately, it's not clear if the governmnet has the spine to follow through with it, and China could get off with a bunch of half-way solutions, like giving it .1% variance or something.

Benton C. Glaze said...

We beat them with sticks.