Trade deficits are ALWAYS detrimental to their nations’ GDPs.

Its a shame that these clichés are so common. It does the free trade position no good! Smoot-Hawley itself had little effect as the overall impact on protectionism wasn't particularly significant

 

There doesn't seem to be much evidence for your claim.

India is one country with a large trade deficit & widespread poverty.

Here are some examples that are contrary to your claims

Wealthy nations with a Trade Surplus:
- Saudi Arabia
- Germany
- Norway
- Netherlands
- South Korea
- Australia
- Switzerland

Poorer nations with Trade Deficit
- India
- Morocco
- Pakistan
- Bangladesh
- Sri Lanka
- Kenya

 

First off, I never said anything about a trade surplus. There's a reason I specifically didn't refer to a surplus as indicating anything. Namely because there are various reasons that a surplus can exist that have nothing to do with individual citizens buying power.

The most obvious example is exporting large amounts of oil or gas, such as Saudi Arabia. Saudi Arabia may be "wealthy" as a nation, but their citizens are not. Which is why they don't import much. But they sure do export tons of oil. Norway exports tons of oil and gas, and Australia exports tons of minerals.
Germany exports tons of automobiles, and their citizens are extremely frugal. Being a high dollar export, they naturally have surplus.

Of course unlike America, Germany hasn't attacked their domestic auto companies with Unions, and government regulation. They also have a much more natural market for exports of autos, whereas we do not. Our auto companies themselves, export tons of autos, but that doesn't show up on your trade deficit. GM doesn't build a car for Europe, here in the US. Instead they open a car company in Europe somewhere, and ship them from there.

The real key is when you look at the largest surpluses, and the largest deficits, that's when a pattern emerges more clearly.

Top 10 Surplus nations:
1. Saudi Arabia 252.756
2. Germany 219.938
3. Russia 198.760
4. China 155.142
5. UAE 80.000
6. Kuwait 72.800
7. Qatar 72.000
8. Norway 67.982
9. Nigeria 64.000
10. Netherlands 63.145

Out of those only, Germany, Norway and Netherlands, is where you could consider the average citizen wealthy. Again, Germany with the massive auto exports, and Norway with the massive oil exports. The wild card is Netherlands, which the information is so limited, I'd be curious to know more about.
The rest, the average person in those countries, can't afford much. So logically imports are low compared to exports.

As for the trade deficit, I didn't say all deficits indicate wealth. I said "I don't know any country running a large trade deficit, in which the people were very poor."
There are many poor nations with tiny trade deficits. But very few with large trade deficits

Top 10 Deficit Nations:
1. USA -784.775
2. UK -162.973
3. India -154.401
4. France -117.676
5. Turkey -105.862
6. Spain -64.691
7. Hong Kong -55.630
8. Italy -33.872
9. Japan -31.593
10. Egypt -28.375

The three odd balls would be of course India, Turkey, and Egypt. Ironically the average wage in Turkey is higher than in Russia. Egypt makes no sense to me, and that was a surprise.

India and Turkey are fast growing economies. India has been growing at 7% to 10% GDP per year for the past decade. Turkey has tripled it's per capita GDP in the past decade.

While the population of both is still relatively poor, they are growing super fast. People are investing in Turkey and India. In the process, they are importing tons of stuff into both. For example, say that Mercedes wants to build cars in India or Turkey. To setup a plant, they have to import nearly everything, from the equipment, power systems (because infrastructure is poor there), to all the materials, because there are no domestic suppliers.

As long as these emerging markets are growing at this speed, there will be tons of imports into the country, even without domestic civilian demand.

However, back to my main point. Out of the top 10 trade deficit countries, only 3 are poor. Out of the top 10 surplus countries, only 3 are 'rich'. Obviously it's not a concrete rule, but does it not seem to be a sort of pattern?

 

Spurious conclusion no different to the nonsense delivered by the neo-mercantilists

 

And protectionism reduces potentional GDP (comparative advantage).

 

AnDelusion, for an explanation of the trade deficits’ detriment to nations’ numbers of jobs and median wages which are reflected by the reduction of their GDPs, google the paragraphs entitled “Trade Balances' effects upon their nation’s GDP” within Wikipedia’s article entitled “Balance of Trade”.

For a proposed remedy refer to the discussion thread
"Reduce the trade deficit; increase GDP & median wage"
http://www.politicalforum.com/showthread.php?t=226393
and/or
google Wikipedia’s article entitled “Import Certificates”.

Respectfully, Supposn

 

Mitigating trade deficits’ detriments to their nations’ numbers of jobs, median wages and thus their GDPs.

Nations’ annual trade deficits are ALWAYS detrimental upon their numbers of jobs and median wage which are reflected within the nations’ GDPs. Those detriments are immediate and their drag upon their nations’ entire economies exceeds the amounts of the trade deficits themselves.
Trade deficits are particularly detrimental to their nations’ families dependent upon salaries and wages; (that includes the overwhelming majority of USA’s middle income earners).

To an extent nations’ lesser than otherwise GDPs due to their trade deficits can be mitigated or even overtaken due to their imported production supporting products. It is also conceivable for a nation’s laborers’ aggregate technical, craftsmanship and production superior accomplishments to similarly mitigate their trade deficit’s detriment to their GDP. Conceivably such mitigation could immediately or eventually match or overtake detriments due to trade deficits.

Unfortunately the USA’s trade deficit is not due to imported production support products and has not demonstrated knowledge, craftsmanship and management skills so superior as to eliminate our trade deficits of goods that have been occurring each year in excess of a half century’s duration.

Respectf¸Supposn

 

The international division of labour is no difference then surgeons being surgeons instead of also being farmers, craftsmen and miners at the same time, but at a bigger scale. The middle class benefits from cheap quality imports because they are not forced to buy overpriced domestic crap.

 

Excerpted from Wikipedia’s article entitled “Balances of trade”.

========================== Trade balances affects upon their nation’s GDP.

========== Annual trade surpluses are immediate and direct additions to their nations’ GDPs.
To some extent exports’ induce additional increases to the GDPs that are not reflected within the export products’ prices; thus trade surpluses contributions to their GDP are generally understated.
Products’ prices generally reflect their producers’ production supporting expenditures. Producers often benefit from some production supporting goods and services at lesser or no cost to the producers.

For example governments may deliberately locate or increase the capacity of their infrastructure, or provide other additional considerations to retain or attract producers within their own jurisdictions. Nations' schools’ and colleges' curriculums may provide job applicants specifically suited to the producer’s needs; or provide specialized research and development. Nations’ entire productions contribute to their GDPs but unless those goods and services are entirely reflected within globally traded products, theses other export supporting productions are not entirely identified and attributed to their nations’ global trade and they do additionally contribute to their nation's economy.

============= Annual trade deficits are immediate and indirect reducers of their nations’ GDPs.
Trade deficits make no net contribution to their nations’ GDPs but the importing nations indirectly deny themselves of the benefits earned by producing nations; (refer to “Annual trade surpluses are immediate and direct additions to their nations’ GDPs”). Among what’s being denied is familiarity with methods, practices, manipulation of tools, materials and fabrication processes.
The economic differences between domestic and imported goods occur prior to the goods entry within the final purchasers' nations. After domestic goods have reached their producers shipping dock or imported goods have been unloaded on to the importing nation’s cargo vessel or entry port’s dock, similar goods have similar economic attributes.

Although supporting products not reflected within the prices of specific items are all captured within the producing nation’s GDP, those supporting but not reflected within prices of globally traded goods are not attributed to nations' global trade. Trade surpluses' contributions and trade deficits' detriments to their nation's GDPs are understated. The entire benefits of production are earned by the exporting nations and denied to the importing nation.

Respectfully, Supposn

 

Er...... fail?

I never suggested that imports don't harm GDP numbers. They do, simply because that's how they calculate GDP. I'm not questioning how imports are factored into GDP. We all know (or the informed know), that GDP is calculated by Private Consumption + Gross Investment + Government spending + (Exports - Imports).

Now logically, looking at the equation used to create the GDP number, obviously less imports will increase the GDP number, and higher imports will lower GDP number.

Yippy Skip. The problem is, just because that is how they calculate GDP, doesn't mean anything on how those imports actually effect the economy.

For example. My company right now, would not exist without imports. If you eliminate imports today, you will not save jobs, you will eliminate them. In fact, all of my previous manufacturing jobs, depended on imports. All of them would cease to exist, without imports.

The problem is, those imports that you think harm wages, in fact create wages, jobs, and growth.

For example, we import materials for our products from China. Yet we also export many of our products around the world.... including.... China. All those exports increase that GDP number. We also sell products in the US, which increases our gross consumption number.

So while the import of materials that we use, according to the GDP equation, is a negative, the fact is, it increase our exports and consumption, which are positives. And it has created hundreds of jobs, of which my own job is one.

Take another example.... Lexus importing automobiles. Lexus has poured millions on millions of dollars in investment, to build dealerships across the country. Investment is a positive. But again, according to the GDP equation, imports are a negative. Yet without those imports, Lexus would not have made those hundreds of millions on millions in investments. Thousands of jobs for managers, sales staff, maintenance people, and on and on, would never have existed without those imports..... which according to the GDP are a negative.

Equally hundreds of thousands of automotive technicians who repair Lexus cars, would not have jobs. Hundreds of parts suppliers, supplying Lexus parts, would not have jobs. Thousands of truck drivers, delivering cars, and parts, would not have jobs.

Millions of people would be unemployed, without the import of Lexus cars, which according to the GDP equation, is a negative. The fact is, it's not a negative. Yes, if all you want is a nifty GDP number, then imports are bad. If you want jobs, and growth, and investment, and wealth, imports are not bad, they are good.

The fact is, controlling imports, has never resulted in economic growth. Never. As in, Never. It never has. It hasn't in US history. And it hasn't around the world. Protectionism, regardless of form, will never be a net benefit.

Having a balance of trade, is not a benefit, nor desirable. It will only harm the economy, and everyone in it.

 

That's all nice.... but it's wrong.

I have seen with my own eyes, the products we build here in the US, that without imports, would not exist.

Those products and services, are a benefit to the nations GDP, and would not happen without imports. So regardless of what the Wiki page says, or what some Ivy league pin head says, the facts are against him. Imports most certainly do benefit the country getting the imports.

Again, if imports are bad, then why has there never been a country without imports, that has expanded and grown? India without imports, was completely impoverished. One of the first things they did was eliminate the prevention of imports.

China without imports was 3rd world status. One of the first things they started doing after allowing capitalism (opening your own business privately), was to dismantle protectionism.

Japan engaged in protectionism in the late 80s. The 90s were terrible for Japan economically. That's why it's called the lost decade, and only in the late 2000 has their economy started to recover, and one of the reasons why, is because they eliminated protectionism. A lot of people don't realize that Ford, and GM both, now have dealerships selling foreign cars in Japan.

Why is it that free-trade countries like Singapore, Hong Kong, S.Korea and Taiwan, have done so well compared to their closed-to-import neighbors? Take even Haiti verses Dominican Republic. DR has a free-trade policy. Haiti, has a very closed trade policy. Which is doing better? Is it even remotely debatable?

Even the fundamental concept, doesn't make sense.

What is 'wealth'? Wealth is stuff. Take two people, and give one a trillion dollars, and the other a life time supply of food water shelter clothing, and put each on separate deserted islands. Which is wealthy? The guy with a life time supply of stuff? Or the guy with the green paper with ink?

Money has no value, except what you can get in exchange for that money. It's the stuff that you buy with the money that has value. STUFF is wealth.

So when we get tons of wealth from around the world, and they get green paper with ink, which one is getting wealthy? We are. We have the stuff. They have green paper. We have cars, and computers, and home theater systems, and they have small pictures of dead people from 200 years ago.

Imports is proof of our wealth. It means we here in the US, have a greater ability to buy things from others, than they do of us. In fact.... go look at the import numbers over the past 10 years. Imports were going up and up, from 2004 to 2007. Imports started declining in 2009 to 2011. When the public had less money to buy stuff, because of the recession, our trade deficit fell. Us being poor, reduced the purchase of goods from others.

If you really want to reduce imports, just make everyone impoverished, and imports will disappear. If you want people to be wealthy, it's going to show up in greater imports, because people will have money to buy stuff from others.

 

Actually the GDP is the best widely available indication of a nation’s production during the reported duration, the purchasing power of a nation’s median wage is the best indicator of its living standards, and the proportion of the median wage to the GDP indicates the extent of the nations distribution of its production among its population.

Trade deficits are detrimental to their nations’ numbers of jobs and median wages which are reflected within their GDPs; (i.e. that’s how trade deficits affect GDPs).
When GDP increases due to any kind of investment bubbles (that are not reflection of production increases) and not accompanied by increased purchasing powers of median wages, the apparent improvement of the nation’s economy is not sustainable. Only national economic improvements that are accompanied by increased purchasing powers of their nation’s median wage are sustainable improvements.

Regarding your company and its dependence upon import materials, these are excerpted from post #107 of this thread entitled “Mitigating trade deficits’ detriments to their nations’ GDPs”:
“… To an extent nations’ lesser than otherwise GDPs due to their trade deficits can be mitigated or even overtaken due to their imported production supporting products.
… Unfortunately the USA’s trade deficit is not due to imported production support products and has not demonstrated knowledge, craftsmanship and management skills so superior as to eliminate our trade deficits of goods that have been occurring each year in excess of a half century’s duration”.

Respectfully, Supposn

 

Andelusion, excerpted from post #109 of this thread:
“ … The economic differences between domestic and imported goods occur prior to the goods entry within the final purchasers' nations. After domestic goods have reached their producers shipping dock or imported goods have been unloaded on to the importing nation’s cargo vessel or entry port’s dock, similar goods have similar economic attributes”.

If the vehicles weren’t Lexus but a product of GM, or a Toyota made in the USA, its post production economic benefit to our nation would be similar to that of a Lexus after the vehicles have reached USA’s jurisdiction.
The nationality of goods is not dependent upon the products name plate; it’s dependent upon the nationality of the aggregate nationality of the labor or other resources that directly and indirectly contributed to the productions of the goods.

I would prefer a trade surplus to an equally balanced global trade but a trade deficit is (excluding the exceptions described in post #107) is detrimental to the numbers of their nations’ jobs and median wages (which in turn are reflected within their GDPs).

You continue to defend imports and global trade which I am not opposing. I'm generally opposed in principle to the detrimental effects of trade deficits upon their nations. I'm particularly opposed to it when the nation is my nation.

Respectfully, Supposn

 

Perhaps you should take a course in International Trade, Supposn1. Your argument is astonishingly poor.

 

China began and still continues allowing private enterprises under extremely government controls. Why would a trade surplus nation practice protectism? But despite this, China still exercises many government controls which are protectionist. They have and are likely to continue turning the valve on or off in any given moment with not prior warning.
If China did or will in the future experience, (as we now do) sustain annual trade deficits, they would have or will enact protectionists policies.

Currency and the purchasing power of amounts of currency are used as common denominators for comparison purposes; (i.e. it’s how we compare “apples and oranges&#8221.
Annual trade deficits are an immediate detriment to nations’ numbers of jobs and the purchasing powers of their median wage which are reflected within those nations’ GDPs.

It is possible for nations to have significant increases in a nation’s GDP due to some particular or general investment incomes’ “bubbles” that are not accompanied with significant increases of their nations’ jobs and median wages. In such cases despite the significant increase GDPs, there’s comparatively less increase of those populations’ living standards. These GDP increases are generally unsustainable and thus justify the adjective “bubbles”.

Respectfully, Supposn

 

Andelusion, you are comingling the concepts of free independent enterprises with the concepts of legislators prohibiting activities which their legislators have identified, explicitly described within written law as being contrary to their jurisdictions’ aggregate economies and/or societies.
Such examples exist within all governments’ levels of USA’s laws and regulations. That’s the justification of the proposal described within the thread entitled “Reduce the trade deficit; increase GDP & median wage"
http://www.politicalforum.com/showthread.php?t=226393
and
within the Wikipedia’s article entitled “Import Certificates”.

Respectfully, Supposn

 

I never suggested that GDP was not the 'best widely available indication of a nation's production". But being the best relative to other indicators, does not mean it's perfect, or that every aspect of it indicates wealth.

"democracy is the worst form of government except all the others that have been tried" What's the point of that statement? It means that yes, Democracy is the best. But being the best, doesn't mean perfect.

That's my argument about GDP. Yes GDP is the best indicator. That doesn't mean it's perfect, and I argue that subtracting imports, is one of those imperfections.

See, again, what is wealth? Wealth is stuff. It's not currency. You can have a billion dollars, and if there is nothing to buy with the currency, then you are poor.



Those are stacks of $1,000 dollar notes. All of that money, was used to buy that one bottle of beer. Zimbabwe.

What is the purpose of "domestic product" in GDP? Why is domestic product 'good' for the country? Well it depends.... on who gets the product. China for decades, produced tons of exported goods, and nearly zero imported goods. In 1978, 63% of Chinese population was living below the Chinese poverty line of $2 a day. All of their 'wealth' was exported. The government has lots of currency, but the public had no 'wealth'.

Stuff is wealth. Who gets the 'stuff' is the wealthy person. Importing stuff, makes us more wealthy. Exporting stuff does not.

And if you really want to compare the relative wealth between the US and China, it's not even close. Yet they have a surplus, and we have a deficit. The poorest people in our country, live better than the middle class of China, and by a fairly large margin too.

If a trade deficit was in fact detrimental to jobs and wages, then why is it when wages and jobs are increasing, so is the trade deficit? Moreover, why is it when the trade deficit falls, so do wages and jobs?



The late 90s were fairly good, with low-unemployment, low inflation, and increasing wages. What was the trade deficit doing that whole time? It was increasing throughout the 90s, until about 2001.

What happened around that time? We had a slow down, and then short recession. Unemployment went up, wages came down. What did the trade deficit do? It shrank.

Then the economy started growing again, unemployment started falling, and wages started creeping back up. What did the trade deficit do? It increased until 2009.

What happened then? We all know, we had a recession. And the trade deficit shrank again, this time, almost by half, while unemployment went up to 10%, and wages fell.

There is no evidence that increasing trade deficit harms wages or jobs, anymore than a declining trade deficit benefits wages and jobs. If anything, we see clearly the exact opposite.

Lastly, about my company, and the comments on imports producing GDP. You said "Unfortunately the USA’s trade deficit is not due to imported production support products"

Bull crap! Top US imports by category.

18.6% Oil. Oil is used in creating MILLIONS of products. Further, oil is used in distributing nearly every single product in existence. Oil supports the entire economy. In fact, Venezuela owns 8 US refineries, and imports oil from Venezuela into the US, refines the oil into oil products, and ships most of those back to the Venezuela. Again, imports creating Domestic productions AND exports.

13.3% Machines, Engines, Pumps. Used in creating manufacturing plants, small appliances, and everything in between. My company has a motor that goes into our product, purchased from Taiwan.

12.7% Electronic Equipment. Voltage testers, scopes, fault finders. We use digital multi-meters to trouble shoot our products.

10.5% Vehicles. Those Volvo Tractors on the highway, that distribute goods across the entire country, were imported.

3% Technical Equipment. Auto insertion machines, and automated equipment. I ran a high speed auto insertion machine, which built thousands of low-watt high intensity lights. No imported machine, no lights. No lights, no job.

2.7% Gems and precious metals. High capacity batteries made from Nickle, Lithium, Cadmium. Catalytic converters on cars, made from Palladium, Platinum and Rhodium. Gems made into Jewelry and other things.

2.3% Organic Chemicals. Used in practically everything.

That's 7 of the top 10 US imports. We also import dyes, fabric, furs, resin, rubber, and a host of various food components used in making food products, such as raw sugar, spices, meats, and cocoa.

All of these things, every single one of them, can and often is, used to create domestic production.

I'm sorry. You are just flat out wrong. Just wrong.

 

No, that's wrong too. First you are using a limited definition of 'economic benefit'. Do I benefit from this computer I'm using? Yes. If I didn't, I wouldn't have bought it. Does it matter where the computer was built, that I am benefiting from it? No. The race, or color of the skin, or the nationality of the individual, that pushed the start button on the machine that cranked out my computer parts, is not relevant to my economic benefit.

I am more wealthy because this computer was built, regardless of where, who, or what country it was built in.

See, again you are looking at what would be better for the GDP number. Now ask me, would I rather have a larger GDP number, or would I rather be wealthy? I'd rather be wealthy. I'll take being wealthy, over having a larger GDP number, any day.

What I'm fighting against, is the concept that imports has detrimental effects. The *ONLY* reason people think imports have determental effects, is because when they created the calculation to come up with GDP, they choose to subtract imports. Imports create tons of GDP, but because of the calculation they came up with, it's considered bad.

It's not bad. That calculation for GDP is wrong. Wealth is stuff, the more stuff you have, regardless of if you make it domestically, or import it, generally the more wealthy you are.

Just look at the top 10 trade deficit / surplus countries according to the WTO.
http://en.wikipedia.org/wiki/List_of_sovereign_states_by_current_account_balance

Of the top 10 Deficit countries, only India, Turkey, and Egypt are what you would consider 'poor'. The rest are all rich countries. And by the way, out of those 3, India and Turkey are in the high growth emerging markets category.

Of the top 10 Surplus countries, only Germany, Norway, and Netherlands, are what you would consider 'rich'.

Germany because they export tons of automobiles, which are high dollar exports, while the German people are notoriously frugal. They don't buy much, thus they don't Import much. If Americans all lived with extreme frugality, we could cut our imports too.

Norway, because as much as the left talks about the 'green energy' of Norway, in reality 50% of all Norway exports are oil and gas.

I have no idea about Neitherland, and information is limited.

Are you seeing a clear pattern hear? Because I am. Which group would I rather be in... the impoverished poor surplus group, or the rich deficit group? I'd rather be with the rich group, and rich people import stuff, and end up with a trade deficit. I'm ok with that. Deficit = Rich. Surplus = Poor.

 

Yes, I know. That's what I'm arguing against, and why I don't care about your 'proposed remedy' to something that is *NOT* a problem.

Your arguments that trade deficits are 'detrimental' to jobs and median wages..... is wrong. Thus... we don't need a solution to something that isn't a problem.

 

Actually that's not true. Even the governments own economic adviser, is on record as saying that have very little control over the economy and private enterprise. I think the interview was in the Economist, which I have a subscription too. I don't think you can access the article without paying.

Nevertheless, why are you asking me, why they engaged in protectionism? The fact is they did, supposedly to protect domestic production. Instead, they just kept themselves poor. Now tons of investment, and imports are flooding into the China every day. Are they poorer, or richer today, due to imports? Richer.

As for what they may, or may not do in the future, doesn't matter. The proof of my claim, is already in the history books.

Still false. You keep repeating it, like if you say it again, it will become true. It is not, and will never be.

 

Andelusion, I stated (in post #116) that annual trade deficits are an immediate detriment to nations’ numbers of jobs and the purchasing powers of their median wage which are reflected within those nations’ GDPs.
I had explicitly stated the logic supporting that statement within post #109.

Your response to my statement is less than explicit and does not attempt to provide any logical reasoning but I haven’t yet read and considered all of your prior posts between #109 and this post #121. I’ll get back to you as soon as I can read and consider all that you’ve additionally contributed to this discussion.
////////////////////////////////////

Andelusion, the topic of this thread is trade deficits’ affect upon their nation’s economy. You inserted a statement regarding people’s lack of health care due to their lacking incomes that reasonably enabled them to purchase effective medical insurance. That statement is not germane to this discussion.

[Furthermore the statement standing alone does not specify if it will remain applicable after all of the Affordable Care Act’s individual provisions are enacted; you did not attribute the statement to any specific individual or any specific creditable source and you accompanied it with your less than an explicit opposing response.]

Respectfully, Supposn

 

Andelusion, gross domestic production is an indicator of the nation’s production usually expressed in a particular national currency. GDP is a statistical description of the nation’s aggregate net production of goods and services. The expenditure method is the most generally employed methods of calculating GDP but all of the methods produce similar resulting amounts. All of the GDP calculation methods directly or indirectly factor in the nations’ net global trade balances.

The expenditure method includes nations’ exports because the final purchasers were not included within the exporting nations’ final purchases of goods and services but they were certainly produced by the exporting nation.
The expenditures’ method excludes nations’ imports because although they were included within the importing nations’ final purchases of goods and services they certainly were not produced within the importing nation.

Someone then may suppose that trade deficits are neutral because they’ do not net increase or decrease their nation’s GDP; those persons would be mistaken.

[Transcribed from post #109 of this thread; excerpted from the paragraphs’ entitled “Trade balances affects upon their nation’s GDP”
within Wikipedia’s article entitled “Balances of trade”:

“Annual trade deficits are immediate and indirect reducers of their nations’ GDPs.
Trade deficits make no net contribution to their nations’ GDPs but the importing nations indirectly deny themselves of the benefits earned by producing nations; (refer to “Annual trade surpluses are immediate and direct additions to their nations’ GDPs&#8221. Among what’s being denied is familiarity with methods, practices, manipulation of tools, materials and fabrication processes.

The economic differences between domestic and imported goods occur prior to the goods entry within the final purchasers' nations. After domestic goods have reached their producers shipping dock or imported goods have been unloaded on to the importing nation’s cargo vessel or entry port’s dock, similar goods have similar economic attributes.

Although supporting products not reflected within the prices of specific items are all captured within the producing nation’s GDP, those supporting but not reflected within prices of globally traded goods are not attributed to nations' global trade. Trade surpluses' contributions and trade deficits' detriments to their nation's GDPs are understated. The entire benefits of production are earned by the exporting nations and denied to the importing nation”.]

Respectfully, Supposn

 

Andelusion, you’re alluding to your post #110 where you stated “For example. My company right now, would not exist without imports. If you eliminate imports today, you will not save jobs, you will eliminate them. In fact, all of my previous manufacturing jobs, depended on imports. All of them would cease to exist, without imports”.

If production supporting rather than consumer goods were attributable to more significant proportion of USA’s imports, USA’s trade deficit of goods would not be a net detriment to USA’s numbers of jobs and our median wage. Unfortunately that is not the case.

I do not disagree with much of what you wrote. The propose remedy for USA’s trade deficit of goods which I’m a proponent of excludes the values of specifically listed precious or scarce minerals integral to goods, from those goods assessed values. For the purpose of that proposal, it treats many organic natural resources such petroleum or diamonds as scarce or precious minerals.
Refer to http://www.politicalforum.com/showthread.php?t=226393
and Wikipedia’s article entitled Import Certificates.

Wage earning families benefit from cheaper imported goods but we populists believe that it doesn’t fully compensate for our trade deficit of goods’ detriment to our median wage and numbers of jobs every year in excess of a half century.

Respectfully, Supposn
////////////////////////
Transcript of post #107 of this thread:
Mitigating trade deficits’ detriments to their nations’ numbers of jobs, median wages and thus their GDPs.

Nations’ annual trade deficits are ALWAYS detrimental upon their numbers of jobs and median wage which are reflected within the nations’ GDPs. Those detriments are immediate and their drag upon their nations’ entire economies exceeds the amounts of the trade deficits themselves.
Trade deficits are particularly detrimental to their nations’ families dependent upon salaries and wages; (that includes the overwhelming majority of USA’s middle income earners).

To an extent nations’ lesser than otherwise GDPs due to their trade deficits can be mitigated or even overtaken due to their imported production supporting products. It is also conceivable for a nation’s laborers’ aggregate technical, craftsmanship and production superior accomplishments to similarly mitigate their trade deficit’s detriment to their GDP. Conceivably such mitigation could immediately or eventually match or overtake detriments due to trade deficits.

Unfortunately the USA’s trade deficit is not due to imported production support products and has not demonstrated knowledge, craftsmanship and management skills so superior as to eliminate our trade deficits of goods that have been occurring each year in excess of a half century’s duration.

Respectfully, Supposn

 

Andelusion, foreign and domestic produced goods are both sold in USA’s domestic markets.
Domestic sales volumes increase when our economy is doing well and they decrease when our economy is doing poorly. There’s no particular proportional relationship between foreign and domestic sales volumes within our domestic markets.

You are confusing causes and effects.

Trade deficits detrimental effects upon their nation’s numbers of jobs and their nation’s median wages are just one of many factors that affect a nation’s economy. Regardless of the nation’s economic conditions, (in both good and poor economic conditions), nation’s numbers of jobs and nation’s median wages are (more than otherwise) immediately detrimentally affected by their annual trade deficits.
[Otherwise being if they were not experiencing those annual trade deficits].

Respectfully, Supposn