24 Pieces of Bad News

[Magibeg]

I find this no good for anyone in North America really.

http://www.minyanville.com/dailyfeed/24-facts-about-the-us/

#1 Ten years ago, the United States was ranked number one in average wealth per adult. In 2010, the United States has fallen to seventh.

#2 The United States once had the highest proportion of young adults with post-secondary degrees in the world. Today, the U.S. has fallen to 12th.

#3 In the 2009 "prosperity index" published by the Legatum Institute, the United States was ranked as just the ninth most prosperous country in the world. That was down five places from 2008.

#4 In 2001, the United States ranked fourth in the world in per capita broadband Internet use. Today it ranks 15th.

#5 The economy of India is projected to become larger than the U.S. economy by the year 2050.

#6 One prominent economist now says that the Chinese economy will be three times larger than the U.S. economy by the year 2040.

#7 According to a new study conducted by Thompson Reuters, China could become the global leader in patent filings by next year.

#8 The United States has lost approximately 42,400 factories since 2001. Approximately 75 percent of those factories employed at least 500 workers while they were still in operation.

#9 The United States has lost a staggering 32 percent of its manufacturing jobs since the year 2000.

#10 Manufacturing employment in the U.S. computer industry is actually lower in 2010 than it was in 1975.

#11 In 1959, manufacturing represented 28 percent of all U.S. economic output. In 2008, it represented only 11.5 percent.

#12 The television manufacturing industry began in the United States. So how many televisions are manufactured in the United States today? According to Princeton University economist Alan S. Blinder, the grand total is zero.

#13 As of the end of 2009, less than 12 million Americans worked in manufacturing. The last time that less than 12 million Americans were employed in manufacturing was in 1941.

#14 Back in 1980, the United States imported approximately 37 percent of the oil that we use. Now we import nearly 60 percent of the oil that we use.

#15 The U.S. trade deficit is running about 40 or 50 billion dollars a month in 2010. That means that by the end of the year approximately half a trillion dollars (or more) will have left the United States for good.

#16 Between 2000 and 2009, America's trade deficit with China increased nearly 300 percent.

#17 Today, the United States spends approximately $3.90 on Chinese goods for every $1 that China spends on goods from the United States.

#18 According to a new study conducted by the Economic Policy Institute, if the U.S. trade deficit with China continues to increase at its current rate, the U.S. economy will lose over half a million jobs this year alone.

#19 American 15-year-olds do not even rank in the top half of all advanced nations when it comes to math or science literacy.

#20 Median household income in the U.S. declined from $51,726 in 2008 to $50,221 in 2009. That was the second yearly decline in a row.

#21 The United States has the third worst poverty rate among the advanced nations tracked by the Organization for Economic Cooperation and Development.

#22 Since the Federal Reserve was created in 1913, the U.S. dollar has lost over 95 percent of its purchasing power.

#23 U.S. government spending as a percentage of GDP is now up to approximately 36 percent.

#24 The Congressional Budget Office is projecting that U.S. government public debt will hit 716 percent of GDP by the year 2080.

[MT Alex]

If #22 was dealt with, the other 23 problems would quickly fall in line.

[Magibeg]

There is some good news though if you're in the banking industry.

http://www.guardian.co.uk/business/2010/oct/12/us-bankers-record-pay-bonuses/print

"US bankers set for record pay and bonuses for second yearPay and bonuses at US banks and hedge funds are set to rise 4% this year – outpacing the growth in revenues – study finds"

[DrPepper]

Only bad news if your from the US. However it's nice to see that some have finally realised your not the only country in the world.

[Papahyooie]

Looks like the mercantilists back in the day were right. Almost all of these either refer to the fact that we don't manufacture or export anything (or are related to it as the root cause) or government spending. Get the damn jobs and factories back in America, and everything will be ok.

[Wile E]

Only bad news if your from the US. However it's nice to see that some have finally realised your not the only country in the world.

No, just the only country that actually matters.

[Steevo]

3uWCOvnOtTI&

Get back in your place in life and slave for the master!!!!!


Conglomerates own the company that made the TV you watch that is made in another country and probably already being touted as the "old" on ads paying the channel that you pay your cable bill to see to know to buy. Or on your phone that you pay for bandwidth on to receive the ads to tell you your phone is outdated so you can pay for another on the cell bill you pay. So you can text your friends on a cell data network that is made of components made in other countries and probably administered by a outsourced company, about your new phone and tv, and your car, that is made in another country, but assembled in the US, out of 90% imported parts, in a factory that employs illegal immigrants who send money back "home" and collect welfare benefits, while you work at a job not likely to be there in 5 years.


But hey, its all good as long as you are entertained, right?

[Papahyooie]

http://img.techpowerup.org/101014/gladiator.jpg

[FordGT90Concept]

#13 As of the end of 2009, less than 12 million Americans worked in manufacturing. The last time that less than 12 million Americans were employed in manufacturing was in 1941.
A high estimate puts that at 4% of the jobs market. That is appalling low. I think the press needs to get on Washington, and extremely hard on Washington, to do your fucking job as far as tarriffs go. This country will continue down a landslide until imports carry their proper premiums. There should be at least one successful company in every area of manufacturering in the USA (that includes TVs). If none exists, raise the tarriffs on said products. Reevaluate the situation annually to keep manufacturing in the USA.

We also need an advertising campaign in the USA which promotes "Made in the USA." It shames me to think that doing so is even necessary.


The more I think about it, all of the problems over the past 20 years could be blamed squarely on inadequate tarriffs (except the stupidity in the financial sector). Jobs can be blamed on inadequate tarriffs, trade deficit could be blamed on inadequate tarriffs, and the length of this recession could be blamed on inadequate tarriffs (manufacturer is always the first area to come back as store supply runs low but manufacturers can't come back when it barely more than exists).

I think It's time to send another message to my senators to demand increasing tarriffs on imports of goods that could and shound be manufacturered in the USA.


Edit: Done (Grassley IA-R) and done (Harkin IA-D). I basically begged them both to bring up tarriffs on the national level, especially Grassley because of his seniority.

[jmcslob]

A high estimate puts that at 4% of the jobs market. That is appalling low. I think the press needs to go on Washington, and extremely hard on Washington, to do your fucking job as far as tarriffs go. This country will continue down a landslide until imports are carry their proper premiums. There should be at least one successful company in every area of manufacturering in the USA (that includes TVs). If none exists, raise the tarriffs on said products. Reevaluate the situation annually to keep manufacturing in the USA.

We also need an advertising campaign in the USA which promotes "Made in the USA." It shames me to think that doing so is even necessary.


The more I think about it, all of the problems over the past 20 years could be blamed squarely on inadequate tarriffs (except the stupidity in the financial sector). Jobs can be blamed on inadequate tarriffs, trade deficit could be blamed on inadequate tarriffs, and the length of this recession could be blamed on inadequate tarriffs (manufacturer is always the first area to come back as store supply runs low but manufacturer can't come back when it barely more than exists).

I think It's time to send another message to my senators to demand increasing tarriffs on imports of goods that could and shound be manufacturered in the USA.


Edit: Done (Voinavich Oh-R) and done (Brown Oh-D). I basically begged them both to bring up tarriffs on the national level, especially Voinavich because of his seniority.
I simply changed the Names as I couldn't of said this point any differently.

Just thinking back 5 years ago we had 790,000 more manufacturing Jobs in North East Ohio alone...

We called for Tariffs as it was happening But were ignored...The only 2 times the Government stepped up was when Goodyear was gonna move ALL of it's Factories to China..Goodyear is based out of Akron Ohio
and another time when a company Formally known Sharon Tube now known as Carlisle industries... Almost went out of business being the last American Company to produce Gas pipe..Sharon Tube is based out of Sharon PA and Warren Oh

EDIT: Just to make this point a little more clear North West PA in the same Time Frame lost roughly 550,000 Manufacturing jobs
Northern Indiana Lost 600,000 Manufacturing Jobs
and
Michigan speaks for itself and Illinois lost a shit load as well

[FordGT90Concept]

And all because China pays their workers what, $1 a week? Yes, it's gonna hurt more to buy stuff but at least that money is going to people that could, in turn, buy from you. China is 3 times more likely to buy their own products than products made in the USA. Until that number naturally comes up, we got to artificially inflate it to protect (and expand) businesses here that employ millions of people collectively. This last decade should have proved that the USA cannot survive on services and information only. The Chinese and Indians have billions of people that will do the same exact service jobs for substantially less money and the Chinese especially won't buy information from you (like how to build integrated circuits) they'll just reverse engineer it and make a clone (like they did with Russian fighters, Hollywood movies, etc.). Pretty much all we sell them is medical supplies and scentific equipment.

[jmcslob]

We could start with ending Tax breaks for creating Jobs..Overseas, that is..
Then we could strategically raise Tariffs on goods, as we used to, such Materials for War Time readiness..

It's not like we need across the board Tariffs
We just need enough to leverage the Dollar.

[FordGT90Concept]

The only way "sending jobs overseas" works is when tarriffs are too low. There is a lot of demand in the USA for all sorts of stuff. When it costs more to manufacture somewhere else and import into the USA, they will instead opt to manufacturer it here.

I think Wal-Mart is #1 to blame for outsourcing to China. They go to a US manufacturer like Rubbermaid and order tons of goods. They do that for a few years forcing the company like Rubbermaid to expand. A few years later, they say we're going to buy your products from China for $x and if you can't meet that, you lose our business. Of course, the USA company can't beat that price and because the company by this time had over 80% of their products sold to Wal-Mart, they have to drastically downsize or go out of business. Jobs are lost here in the USA while equal or more people are employed in China for less money.

If the Chinese goods in the first place equal to or greater than the USA equivilent, Wal-Mart wouldn't have had any incentive to look at China in the first place. Inadequate tarriffs are the sole reason why outsourcing is appealing at all.


The advantage of raising tarriffs on raw materials like oil or iron, steel, silver, platinum, or gold ignots is that it prevents us from touching our reserves here in the USA but at the expense of jobs. Instead, I think I would rather see a cap on raw material production.

[WhiteLotus]

All swings and roundabouts, soon India/China will be the super power, then hell random guess Europe will then come to power, then the states again, then China etc etc etc.

[FordGT90Concept]

The only reason why India and China are coming up so fast is because of trade surpluses with the West. Essentially, USA and Europe are making them grow. The consequence of pumping trillions into their economy and little into ours: our economies stagnate. Essentially, they are both milking the cash cow: us.

Mind you, the living/working conditions in both nations is largely deplorable. There will eventually be a cultural revolution in both places (may involve civil war).

[jmcslob]

And if we keep enough Industry here we could sell em both weapons...

[DrPepper]

No, just the only country that actually matters.

See that's why the entire world hates wile E

http://4.bp.blogspot.com/_UGqFniDBUBY/TJzqPkuOQSI/AAAAAAAABjo/P0UFq6a_94s/s1600/75378-TrollFace.png

[WhiteLotus]

The only reason why India and China are coming up so fast is because of trade surpluses with the West. Essentially, USA and Europe are making them grow. The consequence of pumping trillions into their economy and little into ours: our economies stagnate. Essentially, they are both milking the cash cow: us.

Mind you, the living/working conditions in both nations is largely deplorable. There will eventually be a cultural revolution in both places (may involve civil war).

exactly and as they become more prosperous, they will end up having to increase wages etc etc for their workforce, eventually you will start having to move out of china to get the biggest profit margins, eventually that "third world country" that's the cheapest will be the states and then the cycle begins again.

[FordGT90Concept]

China is already outsourcing to Africa apparently. XD

[WhiteLotus]

China is already outsourcing to Africa apparently. XD

about time someone did

[FordGT90Concept]

True enough. Anything to stop them from slaughtering each other, I guess. Still, the overpopulation issue floats in my mind...

[btarunr]

Mind you, the living/working conditions in both nations is largely deplorable. There will eventually be a cultural revolution in both places (may involve civil war).

Won't happen...
...in China, because they've already discarded most of their culture throughout their "Great Leap" period; and they have an extremely powerful state
...in India, because Indians, like Chinese to a much lesser extant, are the most malleable lot. They are fine with gradual changes as long as economic progress is there.


The only reason why India and China are coming up so fast is because of trade surpluses with the West.

In the process, both China and India are also developing a domestic market. Once EU/US will stop buying stuff made here, we'll just sell it to our own people. We have 2.6 billion people between us.

[yogurt_21]

and around the world jobs go, where they stop nobody knows.
current admin is unlikely to change tariffs, future admins prolly not as well. welcome to rome 580ad. outsourced and stretched to its limits other powers will now begin pushing back after being barraged for so long. and like rome our armies are away in other countries (korea, afghanistan) leaving us ripe to be sacked.

lets be clear though it's unlikely that either china or india will ererge as the super power we or the ussr once were. Historians have always agreed that when the U.S. fell, it would be the last true super power with other unions/countries fighting over pieces of what once was.

[FordGT90Concept]

Won't happen...
...in China, because they've already discarded most of their culture throughout their "Great Leap" period; and they have an extremely powerful state
...in India, because Indians, like Chinese to a much lesser extant, are the most malleable lot. They are fine with gradual changes as long as economic progress is there.

China, there is a humongous disparity between the urban and rural populations. Virtually all don't like their government dictating who is successful and who isn't with only foreign investors keeping conditions in factories livable (where the bulk of the urban population works). I think they have an ideal fuel air mixture brewing (people versus the "Communist Party") and it's just looking for a spark.

India already has not seen gradual changes. There are trucks driving on the same pathways as donkeys. The infrastructure is barely more than existant. I think they are farther away from ignition point than China but there is a lot preventing rapid growth in India.



In the process, both China and India are also developing a domestic market. Once EU/US will stop buying stuff made here, we'll just sell it to our own people. We have 2.6 billion people between us.
With relatively little wealth per capita (https://www.cia.gov/library/publications/the-world-factbook/rankorder/2004rank.html). India ranks 163 and China ranks 128.

[MT Alex]

Are you ignoring the fact that Bta lives in India? Do you assume to school him on the attitudes and social mores of his country? By the way, India borders China, so he may have a liitle more insight to what goes on there.

[FordGT90Concept]

lets be clear though it's unlikely that either china or india will ererge as the super power we or the ussr once were. Historians have always agreed that when the U.S. fell, it would be the last true super power with other unions/countries fighting over pieces of what once was.
I agree. The empires of Spain, Britian, and France were once super powers thanks to Imperialism (conquer as much land as you can to strengthen their position in the world). Come WWII, two new super powers emerged: USA and USSR, also because of Imperialism (USSR claimed a lot of Europe; USA claimed many territories around the Pacific). USSR fell but USA grew stronger making it the sole hyperpower to exist. USA militaristically, could probably still be considered a hyperpower but but economically, it is falling to the level of super power. Assuming China keeps their trajectory (which I have to believe is unsustainable--there's too many exclaimation points looking at the currency, the quality of life, the damage to the environment, etc.) they will also become an economic super power. India, I'm just not seeing it right now.

Basically, Imperialism is dead because land grabs are often met with multi-national conflict; thus, the framework (land) for creating a super power is mostly gone. Future world wars are like to be fought over resources and they will be of desperation, not growth (and we know how that turns out in WWII and Vietnam).


Are you ignoring the fact that Bta lives in India? Do you assume to school him on the attitudes and social mores of his country? By the way, India borders China, so he may have a liitle more insight to what goes on there.
I know btarunr is from India.

[MT Alex]

Just as I suspected, then. You do know it all.:p
http://img.techpowerup.org/101014/4469-26486.jpg

[WhiteLotus]

I agree. The empires of Spain, Britian, and France were once super powers thanks to Imperialism (conquer as much land as you can to strengthen their position in the world). Come WWII, two new super powers emerged: USA and USSR, also because of Imperialism (USSR claimed a lot of Europe; USA claimed many territories around the Pacific). USSR fell but USA grew stronger making it the sole hyperpower to exist. USA militaristically, could probably still be considered a hyperpower but but economically, it is falling to the level of super power. Assuming China keeps their trajectory (which I have to believe is unsustainable--there's too many exclaimation points looking at the currency, the quality of life, the damage to the environment, etc.) they will also become an economic super power. India, I'm just not seeing it right now.

Basically, Imperialism is dead because land grabs are often met with multi-national conflict; thus, the framework (land) for creating a super power is mostly gone. Future world wars are like to be fought over resources and they will be of desperation, not growth (and we know how that turns out in WWII and Vietnam).



I know btarunr is from India.

The only reason that USA became a "hyperpower" is because most of europe was up shits creek with half of it's cities flattened. If we turned to USSR for help they would have became the power.
We are seeing this now, we are turning to China and India for cheap labour and materials as well as goods and services. They will become the power by 2050, most likely in your lifetime. Wont swing back again for a hundred years (maybe).
Soon the dollar will be dropped as the price of oil, already Europe are trying to buy barrels in Euro's.

[btarunr]

China, there is a humongous disparity between the urban and rural populations. Virtually all don't like their government dictating who is successful and who isn't with only foreign investors keeping conditions in factories livable (where the bulk of the urban population works). I think they have an ideal fuel air mixture brewing (people versus the "Communist Party") and it's just looking for a spark.

Incorrect, rural China is exposed to urbanization with its industrialization. Farm life is tough life, it hardly pays, and it's more like bonded labour, instead, work at factories are not only giving them less tedious work compared to farm work, but also paying significantly higher. That is giving them access to "urban" things, accommodation in urban-kind of projects, and modern banking systems, not to mention access to a robust education system. So no, there's little disparity. People go to the cities when they're skilled labour, or the city is deficient in labour, in which case, migrant labour take their place.

In China, you can't move from one province (state) to another, or from outside a city to it, without proper documentation. Of course, you'll find conditions in factories "inferior", but then you're comparing them to your factories, which are so misfit for the competitive market with every-escelating labour-union bullshit, rising salaries, that any manufacturer without China in the supply chain is shunned by investors and market forces (because the product is barely competitive with pricing), they're better. Product quality didn't go down, pricing went down, market choice went up.

India already has not seen gradual changes.

No, India has seen gradual changes. Hundreds of millions have been uplifted from poverty.

There are trucks driving on the same pathways as donkeys.

The infrastructure is barely more than existant. I think they are farther away from ignition point than China but there is a lot preventing rapid growth in India.

Don't be stuck in the Nixon era, it's exactly people that think like this who stuck their heads in the soil (like an Ostrich) that are going "wtf, how did this happen?" at Indochina now.

There are expressways connecting Indian cities, every coastal city has a port, there are airports at 175 mile radii of each other, every big city has a metro rail network, thousands of public transport vehicles are added each year. At the rural-level the government is running out of labour to build canals, dams, rail lines and roads.

With relatively little wealth per capita (https://www.cia.gov/library/publications/the-world-factbook/rankorder/2004rank.html). India ranks 163 and China ranks 128.

For >1.2 billion population economies growing at 10~15%, GDP per-capita rises fast.

[btarunr]

Soon the dollar will be dropped as the price of oil, already Europe are trying to buy barrels in Euro's.

Yes, such a thing is already being mulled with mounting US pressure to revalue the RMB. India is setting up Rupee-Rouble trade with Russia, (for commodities, oil and gas) and EUR trade with EU.

[Steevo]

Won't happen...
...in China, because they've already discarded most of their culture throughout their "Great Leap" period; and they have an extremely powerful state
...in India, because Indians, like Chinese to a much lesser extant, are the most malleable lot. They are fine with gradual changes as long as economic progress is there.




In the process, both China and India are also developing a domestic market. Once EU/US will stop buying stuff made here, we'll just sell it to our own people. We have 2.6 billion people between us.


Both are where the us was in the 40's, full of hungry people and no end in sight.

[btarunr]

Both are where the us was in the 40's, full of hungry people and no end in sight.

If major economies ditch USD for their trade (which is what is beginning to take shape), it will take no time for US to go back to the 40s.

[Steevo]

Yeah, few people here in teh US realize what is happening on the world scene, they have the US is the only country that matters attitude, and fail to realize how much of our daily life is touched by foreign market.

I would guess that 60-70% of items in the average US home are import items.

[FordGT90Concept]

No, India has seen gradual changes. Hundreds of millions have been uplifted from poverty.
"Hundreds of millions" being "uplifted from poverty" is not a "gradual change."



Don't be stuck in the Nixon era, it's exactly people that think like this who stuck their heads in the soil (like an Ostrich) that are going "wtf, how did this happen?" at Indochina now.
What does Nixon have to do with anything?


There are expressways connecting Indian cities, every coastal city has a port, there are airports at 175 mile radii of each other, every big city has a metro rail network, thousands of public transport vehicles are added each year. At the rural-level the government is running out of labour to build canals, dams, rail lines and roads.
You're talking what, 1% of the country's infrastructure is semi-modern? India has a long way to go before it compete with USA or China.



For >1.2 billion population economies growing at 10~15%, GDP per-capita rises fast.
The more people there are, the slower the GDP per capita rises. Like China, how much of that growth is thanks to foreign investment (most likely call centers)?


If major economies ditch USD for their trade (which is what is beginning to take shape), it will take no time for US to go back to the 40s.
Not necessarily. It just means we have a dollar burning fest. There's really no advantage to a currency being traded global except in that every dollar is worth less because of the sheer quantity required. The dollar would strengthen if that were to happen, the question is "by how much?" There is such thing as a currency that is too strong.

[Wile E]

See that's why the entire world hates wile E

http://4.bp.blogspot.com/_UGqFniDBUBY/TJzqPkuOQSI/AAAAAAAABjo/P0UFq6a_94s/s1600/75378-TrollFace.png

I lol'd

[pepsi71ocean]

im thinking that this is to blame doe to NAFTA. but hear me out

But we must all remember that capitalism is in action here, and that our demise was start when NAFTA started. It started with the jobs moving to mexico, and even then when Nixon opened up china, then started moving west.

The solution is to fix the loop holes in the tax/jobs problem.

But the biggest thing will be the death of the unions, without their demise i feel that the cost of mfg will be to great, all we need to do is look at all the mfg jobs that have unions

Ford, Chryster GM, all unionized auto works,, with the help of the union's we "as labor" have priced our selves out of market. The cost per hour is staggaring, GM's cost was i believe revealed to be 102 dollar per employee per hour, WTF?

pricing our selves out managed to bring the down fall with the help of NAFTA.

Once we fix the cost per hour issue then the cost of mfg will drop down and then companies will move back to the USA, which is the cycle we have, we are at the apex i feel, the tipping point at which this country will pit spiral down for the next 10-30 years and there IS NOTHING to be done once it starts.



My Personal thoughts

I think what we need to worry more about now is once the down fal starts making sure we are all debt free, own our houses, and have gun's ammo and seeds, ready for the ability to live lean, expect to be your own police, and farmer to keep things better.


We have the largest debt of any person per society, only American live on debt, i mean how many of us don't pay down credit cards every month? How many of us own our houses? how many are 2 pay checks from bankruptcy?


we as a society are so screwed up that we would rather spend 100 bucks on a louie vaton hand bag, or 80 bucks for designer jeans, WHY? why not buy the decent 20 dollar work jeans, or the cheap knock off handbag for 50 bucks?

this is why i still think that as long as we live large, live on credit, and live pay check to pay check we will be headed for diaster.


I still think we should have bailed out america not the banks, give everyone in america 100,000 dollars to bail out their credit cards pay off their morgages, buy things, imagine the economi fix that would have had, and even then that would have cost only what 30 billion dollars? way cheaper then the 700 billion for TARP, or the 2.2 Trillion for the Obama Bailouts, were so fucked up.





And this is why i think our current dictator is stalling, letting this all happen, because if you think of it like this

we have rode a big roller coaster, with lots of up's and downs, however we are now ready to hit the large hill we climbed up for 20 years or so and now we have hit the apex, we have priced ourselfs out of the market, and now its time to go for the real ride.

[jmcslob]

I think the real problem we face in America is we are competing against people that are still working towards such amenities as sewage, water, natural gas etc..

While we have such lofty goals as Better home entertainment, cars and comfortable mattresses.

We are competing against people that have 18th century standards.

Their simply can't be equal trade until there is equal standards, either we learn to except less or except that true free trade cannot exist on unequal terms..

The simple answer to that is tariffs..Either we except them or we except less...it's our decision.

[Deusxmachina]

Some of the China stuff is interesting and reminds me of the new "An Idiot Abroad" TV show where Ricky Gervais sends his friend around the world "on the most-expensive practical joke ever" because he hates it. The "idiot" then gives quotable wit. There's the Great Wall of China being "It's not that impressive. I'd call it the Alright Wall of China," but, pertaining to this thread...

"I thought this was where they made the iPhone.... iPhone? They should get toilet paper first."

Kind of sums up the trade and manufacturing disparities a bit.

[FordGT90Concept]

Edit: Done (Grassley IA-R) and done (Harkin IA-D). I basically begged them both to bring up tarriffs on the national level, especially Grassley because of his seniority.
MEGAPOST!!!111!!11!1!

...

I said unto Grassley:
Hello again, Mr. Grassley. This got longer than I expected so feel free to skip down to the last three paragraphs. The rest, you most likely already know (manufacturing disappearing, mostly to Asia).

I want to call to your attention probably the most devasting problem facing America for at least the past 10 years: inadequate tarriffs on imported goods. Manufactering in the USA is almost completely gone and that's because not even Americans buy "Made in USA." The reason they don't is because it is cheaper to pay $1 a day to someone in Asia to assemble the product and ship it across the Pacific Ocean than it is to pay someone $10 a day to assemble the same product here. Let's say the final price an American pays for a product is $15 from Asia and $25 for the USA. Most Americans will buy the $15 from Asia and eventually the USA plant will shutdown putting people out of work. Common sense tells us there should be at least a $10 tarriff on the Asian goods (with no exceptions) so that the Asian product and the USA product both cost $25 (or the Asian product would cost more than $25). By being made price competitive, the USA plant can stay open and the money stays in America.

Most of this, I'm sure you already know. The question is: why isn't something being done about it? We import three times more from China than we export to them. We also have huge federal deficits that could be quickly cut down by good tarriffs on imports.

Manufacturering is very important to an economy. Manufacuturering is usually the first sector of the economy to come out of a recession because as people start spending money on the little things (like appliances), shelves are emptied and orders are placed for more inventory. Manufacturing barely even exists in the USA anymore (less than 4% of American jobs are from manufacturing) and this extended recession could be due to that fact (there's no manufacturing to trigger a rebound).

Yes, low wage jobs that manufacturing offers aren't very desirable but at least it is work where none can be found. The "Made in USA" label also holds (or should hold) a high value around the world.

I know a lot of Americans are concerned about China (according to Gallap, China is now #3 which country is the greatest threat to America) but we are hearing virtually none of it on the federal level that must address the issue.

We need to do something about our disappearing manufacturing and I think the only great answer to that problem is proper tarriffs.

Bottomline: Please, use your position and seniority in the Senate to put fourth solid legislation that keeps and creates jobs in America through price competitiveness.

Grassley's (lengthy) reply:
Thank you for taking the time to contact me. As your senator, it is important for me to hear from you. Please accept my apology for the delay in my response.

I appreciate hearing of your concern that we need to take steps to strengthen the competitiveness of the American economy in the globalized economy of the 21st century. I agree with your sentiment, and I have long encouraged Americans who are concerned about jobs and our trade deficits to vote with their pocketbooks by buying products made in the U.S.A. whenever possible.

However, I must say that I disagree with the idea of imposing high tariffs in order to protect workers in the United States. I do not believe that closing our borders would be in our nation's best interest. The United States last tried that approach by substantially raising tariffs in the 1930s, and the resulting collapse in global trade flows contributed to the severity of the Great Depression. So, that's not an approach that I can support.

This brings me to your primary concern-what can we do to bring back good-paying manufacturing jobs? The National Association of Manufacturers (NAM) has noted that for the past two years, the United States has experienced a surplus in manufactured goods trade with those countries with which we have trade agreements-and that this year we are on course to do the same, possibly reaching a $20 billion trade surplus. NAM further notes that about 40 percent of U.S. exports go to our trade agreement partners, while the remaining 60 percent are exported to countries that continue to apply significant trade barriers to U.S. exports.

Indeed, while the World Bank ranks the United States 9th in terms of the openness of our economy to trade, the World Economic Forum has ranked the United States 114th out of 121 countries in terms of the tariffs applied to our exports. Such significant tariff barriers adversely impact all U.S. exporters-97 percent of which are small- and medium-sized enterprises (SMEs), who account for nearly one-third of U.S. merchandise exports.

Notably, the number one destination for SME exports is Canada (92,573 SMEs in the United States exported to Canada in 2008), followed by Mexico (46,748 SMEs exported to Mexico in 2008). Together, Canada and Mexico accounted for a quarter of U.S. merchandise exports by SMEs in 2008. This reflects a particular benefit of the North American Free Trade Agreement (NAFTA)-it provides less daunting export markets for U.S. manufacturers who are just beginning to export. These producers can learn from their experiences exporting to Canada and Mexico, and hopefully expand their exports to other markets around the world. That's important, because 95 percent of the world's consumers live outside of the United States.

If there were a level playing field for U.S. exporters, our manufacturers would produce more and sell more to overseas markets. So, we need to tackle the significant barriers facing 60 percent of our exports. Yet, the only way to achieve that is to negotiate with our trading partners to reach agreements on the reduction and elimination of their trade barriers to our exports. If we don't, we risk being left behind by the rest of the world.

Unfortunately, that's already happening. According to the World Trade Organization (WTO), there are 262 free trade agreements in force around the world, but the United States has trade agreements with just 17 countries. Currently, there are more than 100 bilateral and regional trade agreements under negotiation, but the United States is a party to just one such negotiation. Do we really want to cede leadership of international trade to the Chinese, so that they set the rules of trade for the 21st century, or do we want to maintain our leadership to ensure that the rules reflect U.S. values and protect U.S. priorities? I firmly believe that it is in our national interest to maintain that leadership which the United States has exercised responsibly since World War II.

That's not to say that we shouldn't respond firmly when China or other countries pursue unfair trade policies that violate their international trade obligations. We should. And, we have a number of tools with which to do so under the current framework for international trade, which we helped to establish. When we win cases against our trading partners at the WTO, they are obliged to bring their practices into accordance with the rules. If they fail to do so, we can impose additional tariffs on their products and they have no right to impose retaliatory tariffs on the products we send to them. The same goes when we impose tariffs on foreign products under our trade remedy laws. In both scenarios, the rules permit us to defend our interests in a way that won't incite a trade war that will hurt Iowa's manufacturers and farmers. To give just one example, during the first half of 2010, our exports to China exceeded $41 billion, which represents an almost 36 percent increase compared to the same period in 2009. Those export sales are sustaining many good-paying jobs in Iowa and across the United States. We should not imperil the livelihoods of those workers if we can avoid it.

The United States has successfully availed itself of the dispute settlement process at the World Trade Organization (WTO) in a number of important cases, and just recently we filed two more cases against China. I endorsed the President's decision to file these cases against China, and I again called upon his Administration to bring a separate case against China's unfair currency manipulation. Between negotiating and implementing new trade agreements, and enforcing the rules of the agreements that we've already implemented, we can level the playing field for American workers, to help sustain good-paying jobs right here in the United States.

Separately, I am working with my colleagues to ensure fair competition in the U.S. market by strengthening the prohibition on importing goods that are made from forced labor. Current law prohibits the entry of goods into the United States if they were made from convict labor or forced or indentured labor, including forced or indentured child labor. However, this law includes an exception which creates a loophole. Specifically, the current law permits the importation of a good made from forced labor if production of such good in the United States is insufficient to meet the domestic demand for that good.

I worked with Democratic members of the Finance Committee to update this law in important ways, and last year we introduced legislation to implement those revisions. First, we would repeal the loophole in current law, making it illegal to import any good made with forced labor. We would also expand the prohibition to cover goods made by means of coercion or by people who were subjected to severe forms of trafficking-such as sex trafficking, or the recruitment or transportation of a person for debt bondage. In addition, this legislation would establish a new office to coordinate federal efforts to enforce these prohibitions. New civil penalties would be added for violating these prohibitions, on top of the civil and criminal penalties already provided for under current law. I am committed to pushing this legislation through the legislative process and seeing it enacted into law as soon as possible.

One reason for some of the controversy surrounding our trade policies is that the benefits of trade are widely spread, while the costs can fall disproportionately on certain individuals. I am aware of that disparity, and I believe we have a responsibility to look out for those workers who are negatively impacted by trade. That's why I worked with the Chairman of the Finance Committee and our House counterparts on a wholesale restructuring and expansion of the federal trade adjustment assistance program.

Our legislation, which the President signed into law in February last year, changed the trade adjustment assistance program in important ways. It expanded the pool of workers who are eligible for benefits under the program to better reflect our modern workforce, including workers in the services sector. It significantly increased both the flexibility of the program and the available resources so that eligible individuals will be able to respond to their job loss in the best way that they see fit. And, it improved the accountability and internal oversight of the program-both at the state and federal level-to provide additional assurance that taxpayer monies will be well-spent. The reforms that we achieved are providing immediate benefits to workers negatively impacted by trade in Iowa and across the United States.

In closing, I know that you may not agree with everything I've said in this letter. And I understand that you may not be satisfied by my position on the issue of international trade. I can assure you, however, that I am motivated by what I believe to be in the best interests of the citizens of Iowa. That will continue to be my motivation in the future as well.

Again, thank you for contacting me. I appreciate hearing your views and urge you to keep in touch.

Sincerely,
Chuck

I don't have the message I sent to Harkin but the jist of it was the same as what was sent to Grassley above. Here is Harkin's reply:
Thank you for writing to me regarding our trading relationship with China. I am glad you took the time bringing your concerns to my attention. There are many trade issues that are contributing to the economic tensions between the U.S. and China.

Until a few years ago, the Chinese currency, the yuan, was pegged to the U.S. dollar which contributed to our growing trade deficit with the country, and the yuan remains undervalued relative to the dollar. Other trade issues facing our two countries include surging Chinese textile exports, widespread piracy of U.S. intellectual property rights (especially in entertainment and computer software), arbitrary restrictions on U.S. agricultural imports, and government subsidization of Chinese companies allowing their exports to undercut prices sought by U.S. competitors. The bottom line is that China is the single largest contributor to the U.S. merchandise trade deficit, accounting for nearly one-third ($232.6 billion) of the record $764 billion deficit for 2006..

I will continue to follow this issue and other trade concerns with China. The U.S. government has many tools at its disposal to address unfair trade practices by China and other countries, and we should be fully prepared to utilize these remedies when needed.

Sincerely,
Tom Harkin
United States Senator

Very intriguing replies, me thinks.

Interesting how I received a reply from both on the same day (October 29).

[btarunr]

As always, the Dem was more result-oriented and to the point.

[FordGT90Concept]

Grassley was the Senate Finance Committee chair until Democrats took control in 2007. He naturally has more to say about the issue because he is involved in it. Harkin is the chairman on Pensions and Senate Committee on Agriculture, Nutrition and Forestry--not really trade centric.

If I asked the same question of McCain, for example, it would be fairly short and concise. Long is Grassley's personality and short is Harkin's. Oh, and John Kerry would talk your ear off.


What it comes down to is raise tarriffs (which Harkin isn't necessarily in favor of but would support--like most Democrats) or form trade agrements to reduce import tarriffs on American exports (which Grassley--and most Republicans--supports).


After some research (http://www.suite101.com/content/united-states-exports-so-far-in-2010-by-trade-partner-country-a277026), Grassley appears to have the right idea. NAFTA is likely to be the reason why Canada and Mexico are ranked #1 and #2 for American exports.

At the same time, I can't help but think that high tarriffs should be met with high tarriffs until an agreement is reached (like with China). Trade should be a two-way street, not one-way.