Does it mattter if the USA has a deficit
So long as the USA has the reserve dollar, country to country settlements for goods and services of large and small transactions are made in USD
When our farm buys parts from your country we pay in USD
If the USA did not have a deficit how in the world would there be enough hard currency to make settlements
You don't have to pay your debt or even the int on the debt
You can monetize the debt
How else do you think you folks can pay billions for a war machine
Military bases out the wazzu
All paid with USD
The world then uses those USD to conduct normal business
You have a defecit with china
Does that really matter
Those USD have to go into circulation some how
Your problem was you let the technology go with the manufacturing factories into china. I know because I was in china and saw the results 1st hand
Now you see china manufacturing, what you thought was a monopoly of manufacturing you controlled
In the quest for profit you sold, the store of technology, most of it for free
I know china stole a lot but they had to if they were going to join, or catch up to the the western world
At least seen from their perspective
You did not care if you out sourced americian jobs
Cheap labour meant more to you, than americian jobs
Now your economy has recovered with the lowest unemployment in how many yrs??
The chickens have come home to roost and you take exception to your own major decisions of yrs past
Just let it go and get on with business
You have already done major harm to your markets with a tit for tat trade war
Your economy has recovered. If you had not ruined your Ag markets and caused domestic harm with some costly imports that harm your economy. Just think what could have been
Just be happy you have the reserve dollar and a strong economy
Why does the trade deficit really matter in the larger picture
A few billion of trade deficit is a spit in the ocean, when you have trillion dollar budgets
Why do you always see things through the prism of some kind of war
You already have more than any other country on the planet
Why do you want more
Just get on with it and be happy you have so many advantages
You bring up half a dozen different points. I'll touch on one of them that is often on my mind.
For sure we like in one of the best places (Canada doesn't have it so bad either) on the planet and with absolute certainty, all of us live at the best time in human history.
Kings and Queens didn't have it nearly as good as most of the poor people do in our country today.
You can't say that about poor people globally, as many of them don't have enough food or water and things that we take for granted. But there is hope for these people because the rest of the world can help them vs 150 years ago, when the ability to transport goods/people and communicate was a tiny fraction of what it is today.
So the US can afford to share more of our wealth. Ironically, this is what the Climate Accord is all about. It's a complete scientific fraud that could never do anything to affect the climate........instead, it's a transfer of wealth from the rich to the poor countries.
I could really support that but it also wrecks our economy for no legit reason to cut back on a beneficial gas, CO2 as well as having set back climate science by numerous decades by doing things like rewriting climate history to take out the Medieval Warm Period and scaring people into thinking that we are having a climate crisis/emergency during this climate optimum.
Back to the original point. Americans were born into abundance and take it for granted and many, not knowing anything different, just live in their little bubble(not that different than Canadians who are also very well off) consuming massive amounts of natural resources and making real pollution(CO2 is a beneficial gas) with little regard for the planet or others. Ironically, the climate crisis takes the focus OFF of this because it focuses on a completely fake crisis for political agenda and ignores the real environmental and other serious problems.
If these fake environmentalists really cared about the planet, why are they not pointing out the real problems?
The real environmental crisis's/insects dying-dead zones-aquifers drying up-plastics in the ocean: April 2019
The mentality that we can act this way towards the planet and not be accountable sort of fits with the mentality that has led to our exploding debt..................no accountability for todays actions.
A good analogy is the Ogallala aquifer in the Plains, which is explained in the link above. It's being drained at an unsustainable rate, some of that water used for things that are based on fulfilling the greedy needs of people living there right now at the expense of their grandchildren in 50 years that will have no water.
The aquifer, at one time had an amount of water equal to that of Lake Michigan but maybe half of that is gone. If it was above land, it might get a bit more attention but people just know they have lots of water now and they don't want to cut back.
The debt, though we can see or read about the number has also lost any relative meaning to the average person.
If you thought the debt was 12,000,000,000,000, then found out it was really 22,000,000,000,000 would you think "OMG! it's now out of control, we must do something!"
We've been hearing for decades about how the debt was going to cause big problems down the road, since it was just a fraction of the current debt and since nothing bad has happened.........YET, people are complacent and assume nothing bad will happen, at least not for a long time, so why do anything now.
Cutting the debt would be bad for politicians trying to get elected, so the ones that could really do the cutting, are more for growing the debt because Americans like political leaders that tax them less and give them more stuff even if it means no balanced budget.
The biggest thing too is the number of zeros in that debt number. People can relate to the cost of stuff when they are actually buying it. A computer or cell phone or car or house. They know what the range is between a cheap one and an expensive one.
They know what a good paying job pays and about taxes. Things that they and they friends deal with in the real world. They can even understand how massive the salaries of professional sports players are who get millions of dollars/year.
The world of the US debt is like another realm though. Once you get way up into the trillions, the current debt of instance has 14 numbers, you lose touch of its meaning.
For instance, gas right now is $2.50 a gallon in many places. If we had to pay $5.00/gallon, we would all be outraged and screaming bloody murder.
The current debt is 22,000,000,000,000 for instance. How outraged are you that it doubled from 11,000,000,000,000 from not that long ago?
What if we added another 0 to that number and made it 220,000,000,000,000. It doesn't really look that much bigger, just another 0......15 numbers instead of 14 and what if that's the number that we were told is the real national debt 220 trillion, which is 10 times bigger.
Would we all be flabbergasted and suddenly realize its catastrophic (like gas going to $25/gallon)?
No, because we can't connect to the reality of what that number really means.
Whether its 22 trillion, like below or 22 quadrillion, what's the difference if everybody has a job and our country is prospering here in 2019?
We have not paid much of a price so far but that will not continue indefinitely. With an aging population and government expenses likely to go way up in the future, it's the recipe for an increasing burden on our economy and country.
Because of the automation of tens of millions of jobs in the next decade, unemployment rates are likely to go much higher than this.
It's actually the recipe for disaster. And if you dialed in plans to cut back on the use of cheap, efficient, reliable and abundant fossil fuels(with plans like the Green New Deal), it would be an assurance of a severe, long lived depression.
Industrial robot prices are decreasing.
So we are currently living at time when all the stars are in alignment for our economy and no matter how many zero's and warnings about our national debt, nothing bad has happened.
This will be impossible to sustain and the bigger the debt is, when it starts going the other way, the faster the drop will be.
1. The aging population will grow with 100% certainty.
2. Automation will replace millions of jobs, almost certainty
3. The debt will matter much more then.......but it will be too late. The only times that you can reduce debt is during the good times. It's the complete opposite during bad times.......when adding to the debt temporarily is justified, in fact sometimes a necessity to avoid a depression.
People know that our politicians and government are messed up and can't be trusted about anything but act as if their bad policies causing the explosive debt are peachy keen because it means more goodies for all of us...........today.
Instead of saving the greening planet for our children from the fake climate crisis which exists only on computer simulations of the future based on busted climate models............ we should be saving our economy and way of life from the REAL crushing debt and realities of #1 and #2 which are not based on a busted theory.
The thing about automation....
No doubt automation will replace a lot of the jobs we currently do. That's the reason for automation. More reliable and cheaper, almost always much faster. Can't stop that. Why would we. Efficiency improves life and standard of living for everyone in a given society. Look at the lifestyles of the early 1900's vs. today. What we consider absolute necessities were extravagant luxuries, if they even existed. Something as simple as indoor plumbing. You were doing well if you had a pump at the kitchen sink back then.
But at the beginning of the last century, most of us were farmers. There was a time telephone operators numbered in the 100's of thousands. Literally millions of jobs have been eliminated in a short time. And many of us, if not most, perform jobs/tasks that didn't exist a short while ago.
I think that trend will continue. Our challenge going forward is what to do with unskilled labor.
Wayne and I are having a contest.............to see who can make the longest post (-:
I agree with Tim
The thing that keeps getting repeated down through the ages is the buggy whip maker
OMG what will all the unemployed buggy whip people do for a job
Well many of them found other jobs
At the turn of the century a strong back mostly assured you a job
As Tim says -- what will happen to the unskilled
As usual given the higher education many people have, there will be jobs running the automated robots
I hate the term robot as it is actually a machine with soft ware that enables the machine to perform many different tasks But it is still a machine that will break down, wear out etc. People can and will learn new skills to repair or trouble shoot a malfunctioning machine, or build new machines
This is just one example of people learning to adapt in the job market place. My wife took many nite classes to broaden her skill set and was a valuable employee, at least her pay check indicated some body valued her contribution in her chosen field of expertise, but she had to keep learning new skills
I think the people Tim is referring to are the people that can not or will not learn new skills. Perhaps they can't learn new skills and thus the market place has few job openings for unskilled workers who can not or will not learn a skill, such as the job market wants
On our farm we are constantly looking for certain skills. We would train people if they would stay and be a valuable employee. The problem is most look at what is required to learn the skills and give up before even trying to learn some thing new
I agree that tens of million of unskilled jobs will be replaced robots and be the biggest problem for those people to find work
However, there's something called the law of diminishing returns that applies in most realms. I started a new thread on this topic because its different than deficit
massive debts worldwide is one the main reasons why economies are stagnating. this is not just our federal debt, but all debt. so yes, in a general manner, deficits DO matter. at some point, i expect the world economy to gradually evolve into a depression, and then growing inflation then, hyperinflation, as central banks continue to try to print our way out of the problem. this will not happen this year.
by about 2075, the western world will have 30% inflation, and 30% unemployment. central banks will just keep on printing, because they do not want to allow the debt to collapse.
more and more people will start to understand that central banking is part of the problem, NOT part of the solution.
this is how countries go down the drain.
too much debt, too much bureaucracy, debasing the currency, too much socialism. etc. etc.
dems will bankrupt us with too much socialism. pubs will bankrupt us with too much military spending.
either way, it still takes us down the same path of too much debt, and debasing the currency, and a lower standard of living for all.