Stirring the "Buy American" pot

[dwasson]

What's American These Days? Only 65% of the content of a Ford Mustang comes from the U.S. or Canada. Ford buys the rest of the Mustang's parts abroad. The Toyota Sienna is assembled in Indiana with 90% local components.

Check it out (http://online.wsj.com/public/article/SB114731076341249773-HGAy7lJ09H_wFrUq6whlcBMUBXo_20 060609.html?mod=tff_main_tff_t op)

[jgc61sr2002]

What's American These Days? Only 65% of the content of a Ford Mustang comes from the U.S. or Canada. Ford buys the rest of the Mustang's parts abroad. The Toyota Sienna is assembled in Indiana with 90% local components.

Check it out (http://online.wsj.com/public/article/SB114731076341249773-HGAy7lJ09H_wFrUq6whlcBMUBXo_20 060609.html?mod=tff_main_tff_t op)



That's the truth, some so called foreign cars have more American made parts than some American cars. That's:bs:

[Rider90]

As much as I want to be ignorant when it comes to this topic, it's the truth...

[Marauderjack]

Hello.....Our cars are foreign.....CANADIAN!!!:bows:

Thanks you Canucks!!:beer:

Marauderjack:burnout:

[jerrym3]

Back in the mid 60s, I worked in a Ford Parts Depot in Teterboro, NJ. (My older co-workers were a little bit upset when I pulled into the company parking lot in 1965 with a brand new Corvette roadster, Nassau blue in and out, two tops, 327/300, 4 speed.)

It was amazing to see the number of parts with "made in Canada" stamped on them even back then.

[jgc61sr2002]

Back in the mid 60s, I worked in a Ford Parts Depot in Teterboro, NJ. (My older co-workers were a little bit upset when I pulled into the company parking lot in 1965 with a brand new Corvette roadster, Nassau blue in and out, two tops, 327/300, 4 speed.)

It was amazing to see the number of parts with "made in Canada" stamped on them even back then.



Also had a 1965 Corvette Nassau blue white interior, two tops and power windows.327/300 4 speed.:D Sure wish we had them now.:(

[BruteForce]

"Buy American" is more about where the profit ends up rather than where the expenses (parts, labor, etc) go. Back when the unions were really pushing this, it was more about where the expenses went. Not so any more.

[Wires]

Two comments about the profit:

1. Then Dodge cars should be considered foreign, because Dodge is owned by Daimler Chrysler, in Germany.

2. If GM is losing money with every car sold, aren't you hurting GM every time you buy one?


I personally like my Canadian car, despite the fact that the parts come in boxes labled "Ford" and "made in Mexico" or "made in China."

My personal opinion is you can't divide things into just those two groups anymore. Even a made in Japan car has some US content in it, not to mention the shipyard workers, the truckers, the dealer, the dealer's employees, etc. etc. Are they not Americans?

Yes, Chrysler still has a significant US presence, but so do Toyota, Honda and others.

It's not black and white anymore.

[duhtroll]

It's not black and white anymore.

I think it is. Find the corporate shareholders and where the profits go, as Brute said, and you will know what is an American car vs. a foreign car.

[Wires]

I think it is. Find the corporate shareholders and where the profits go, as Brute said, and you will know what is an American car vs. a foreign car.

If corporate/sharholder profits are the only factor, then what about Daimler Chrysler? By your definition, that makes the Dodges and Chryslers Foreign, if we must be "black and white" about things.

Things aren't "black and white." Even for a car built in the US, by US workers, and for a US company has some foreign parts in it. Not ALL of the profits go to US companies.

Even a car Made in Japan, by Japanese workers, for a Japanese company, has some US content in it, not to mention the Teamsters who deliver the parts and the cars.

In between is a broad spectrum of grey - Daimler Chrysler is owned by both Germany and US businessmen. US workers assemble cars in the US for Japanese companies. Canadian workers build Fords. I don't think this is a black and white issue anymore.

Why is corporate/sharholder profit the deciding factor?

What about the Teamsters who ship foreign cars from the ports to the dealers?

What about the US mechanics who prep, maintain and repair these cars?

What about the factory worker in the US factory making Toyotas or BMWs?

In my opinion, they count just as much, if not more, than the corporate sharholders.

I'm not saying you are wrong - I don't really want to argue. However, I don't think the corporate investors or executives are more important than factory workers. Why is money going to "corporate" the defining factor over money going to US workers?

If most of the cost of a car is in labor, then why is it better to have a smaller amount go to an american company and its sharholders rather than to have a larger amount go to the American workers?

That's why I say it isn't black and white anymore - there are too many factors to consider and the money isn't all going to one place. The days of "foreign cars are all foreign" and "domestic cars are all domestic" are long gone.

[duhtroll]

If corporate/sharholder profits are the only factor, then what about Daimler Chrysler? By your definition, that makes the Dodges and Chryslers Foreign, if we must be "black and white" about things.

Yep.




Why is corporate/sharholder profit the deciding factor?

Because that's where the money made by the company goes. It's a global market, so they may well reinvest these profits into businesses from other countries, but that does not change the fact that "the money is going overseas."

All of those other people that you mentioned being involved -- they merely work for a foreign company. They do not represent corporate profit. Companies still will always do the job with the fewest number of man hours possible, and pay those hours as cheaply as they can get them.

A US company that outsources its labor still holds the profits here in the US (or in an offshore account to avoid paying taxes on it).

Follow the money.

[Wires]

I disagree with you, but I apreciate a dissenting opinion based on sound reasoning and one that is logically consistant.

I apoligize for my rambling, poorly worded post, but I think I've made my case well enough.

I see a spectrum of grey, you see black and white. Different people have different viewpoints.

[Mike M]

I have never and will never buy a car other then GM, Ford, or Chrysler...PERIOD.
I do not care about the content of parts or any other excuse. There is no reason to buy anything else and I have already told my children they will be dis-owned if they buy anything else.

[Wires]

Chrysler? There is no "Chrysler." If you mean DAIMLER-Chrysler, then you must know that this new company is partially if not at least half owned by German businessmen. Buying a Daimler-Chrysler gives money to the US part as well as the German part.

I don't see any difference between that and buying a Honda and having the MAJORITY of the money go to the US workers who built it, the US businessmen who sold it, and the US employess of Honda America.

(By the way, I detest Hondas and would never own them, but that's because I dislike their vehicles. That's how I make my choice. But I digress and I aologize for that digression.)

My FORD was made in Canada. Just because the Ford company made money as well, that doesn't negate the fact that it was Canadian and not US assembly workers who got my money.

I now see why this post mentioned "stirring the pot."

[Wires]

Mike: Does your "buy American rule" only apply to cars?

What about Televisions? or Tires?

[dwasson]

Mike: Does your "buy American rule" only apply to cars?

What about Televisions? or Tires?

I would love to walk through the homes of the most rabid "Buy American" types and see how much of their stuff is imported. Except for top quality suits, there isn't a lot of clothing that you can bet on being made in North America.

But the real point is this:

Can any of the "buy american" people tell me exactly how much extra I should pay to buy a car I don't like, just to "buy american"?

[Mike M]

I try to stick to buying American when ever possible. It gets kinda hard with some electronics when there are no American companies left.

Maybe I am the only guy left that looks for a "Made in America" label. If there isn't one to be found then you do what you have to do.

It's easy to justify and make excuses but just trying a little harder to look for "Made in America" does't make me wrong. There are times you just can't buy a product unless it is made in Maylasia or somewhere. But if I pick up 2 different pair of socks and one is made in the USA and if it cost more or less it's going in my shopping cart. More importantly, "in my opinion" the big three auto makers still sell the best cars in the world.

I have never in my life looked at any import car and said "man I want that to be my next new car", I have owned alot of cars in my life and I can tell you during the planning-research-and buying stages has any import ever crept into my head or wallet. We passed alot of honda and toyota dealerships on our way to buy our new Hemi Durango, just as I passed alot of import dealerships to buy my Marauder.

[dwasson]

More importantly, "in my opinion" the big three auto makers still sell the best cars in the world.

But, what if I disagree? What if I believe that Honda makes the best car?

[O's Fan Rich]

Hello.....Our cars are foreign.....CANADIAN!!!:bows:

Thanks you Canucks!!:beer:

Marauderjack:burnout:
Yep, took me two weeks to clear all the snow outta mine....

I think the days of "Buy American" when it comes to our cars is gone the way of the DoDo, can't get one , cause they no longer exist.

[Wires]

For anyone who doesn't know, Nitto tires are made by Toyo, a Japanese company. However, there might not be an American tire company that makes tires suitable for a Marauder.

One of the two US tire comanies is Cooper tire. They make many of their tires in China. I'd rather my money go to the US worker making tires for Bridgestone or Michelin. As I said before, in my mind, those Americans are just as good as the American "big wigs" that own/run the company.

I still don't understand why you exempt DAIMLER Chrysler. That company is at least half owned by Germans. No different than Honda of America being over half owned by Japanese.

I don't know how to write that to not sound confrontational - It's your right to place them in the "can buy" category, but I don't understand why those foreign owners are better than other foreign owners.

In other words, when person A buys a Daimler Chrysler, some money will go to Americans, some will go to Germans. If person B buys a Honda, some money will go to Americans, and some to Japanese. Depending on who makes what where, the total money going to Americans might be higher for the Honda. Why is money going to "big wigs" better than the hard working Americans who build the things?

[Mike M]

But, what if I disagree? What if I believe that Honda makes the best car?

I am not your father...you can believe or do what ever you want. This is America after all. :-)

[Wires]

I try to stick to buying American when ever possible. It gets kinda hard with some electronics when there are no American companies left.

Maybe I am the only guy left that looks for a "Made in America" label.
Unfortunatly, one doesn't get to make a choice very often.

Even the good old American names are foreign owned when it comes to Electronics, sadly. At one time, RCA and GE were owned by the French, but I can't keep up.

I shop for the best quality I can afford for the item that meets my wants or needs.

When I was plumbing my air compressor, I was dissapointed in the Chinese fittings from Home Depot. I went to my local Mom and Pop store, but it was too late. All they can get is the Chinese fittings. I dug around to find some good-ole made in the USA fittings to use, but some were not available.

I do agree that it is better to buy American, my only point of disagreement is that it's not "either or" anymore. No car is purely American, and none is purely Foreign. I also don't distinguish between the corporate "suits" and the workers. Americans are Americans.

So, if we total up the money going to Americans, and the money going to "Non-Americans," we might find that, based on the profit margin for any given car, that buying a Honda made in the US gives more money to Americans than a Ford built in Canda. It may even change from day to day, or model to model, or based on parts cost or supplier.

I work with men and women who work hard building machines every day. I can't look them in the eye and tell them that buying a Caterpillar (Made in Japan) is better than the one they made just because of company ownership. I can't look them in the eye and tell them the shareholders and corporate suits mean more than they do. I'm riding on their backs everyday, and I want the world to know I'm proud of the equipment they make - it's the best in the world. I want anyone deciding which machine to buy to consider them more than the corporate profits. When our sales are up, their kids get better presents, and eat better. They are just as American as the owners and shareholders. Our machines say "made in the USA."

[Mike M]

Unfortunatly, one doesn't get to make a choice very often.

Even the good old American names are foreign owned when it comes to Electronics, sadly. At one time, RCA and GE were owned by the French, but I can't keep up.

I shop for the best quality I can afford for the item that meets my wants or needs.

When I was plumbing my air compressor, I was dissapointed in the Chinese fittings from Home Depot. I went to my local Mom and Pop store, but it was too late. All they can get is the Chinese fittings. I dug around to find some good-ole made in the USA fittings to use, but some were not available.

I do agree that it is better to buy American, my only point of disagreement is that it's not "either or" anymore. No car is purely American, and none is purely Foreign. I also don't distinguish between the corporate "suits" and the workers. Americans are Americans.

So, if we total up the money going to Americans, and the money going to "Non-Americans," we might find that, based on the profit margin for any given car, that buying a Honda made in the US gives more money to Americans than a Ford built in Canda. It may even change from day to day, or model to model, or based on parts cost or supplier.

I work with men and women who work hard building machines every day. I can't look them in the eye and tell them that buying a Caterpillar (Made in Japan) is better than the one they made just because of company ownership. I can't look them in the eye and tell them the shareholders and corporate suits mean more than they do. I'm riding on their backs everyday, and I want the world to know I'm proud of the equipment they make - it's the best in the world. I want anyone deciding which machine to buy to consider them more than the corporate profits. When our sales are up, their kids get better presents, and eat better. They are just as American as the owners and shareholders. Our machines say "made in the USA."


Well said.

[Bluerauder]

I shop for the best quality I can afford for the item that meets my wants or needs.

I agree.


I can't look them in the eye and tell them that buying a Caterpillar (Made in Japan) ...
When the heck did this happen to CAT ?? :confused: I know that they were having some problems a few years back. Must have missed this news. Ever since I was a kid ... the brand name of Caterpillar was just like the 82nd Airborne .... "All American".

[StevenJ]

Well there are still some companies left that make everything in America. Now what I'm about to show you is a toy company that makes model trains, yes nerdy I know but everything they make is assembled and built right here in the United States in La Porte, Indiana.

www.h-l-w.com (http://www.h-l-w.com)

So there's still at least one toy company sticking out and building everything here at an affordable price with a good quality product in the USA. I have purchased a number of the products.

On a more serious note, not all of us care much for model trains which is acceptable and understandable. But have you ever needed to get your wife or daughters any gifts for valtentines day/ christmas and not know what to get? Well Vemont teddies build high quality custom teddy bears and their made in Vermont.

http://ir.vtbearcompany.com/index.php?id=141

So you see there are still companies left that where most have gone to China they still make their products in the US.

[mr.continental]

Well there are still some companies left that make everything in America. Now what I'm about to show you is a toy company that makes model trains, yes nerdy I know but everything they make is assembled and built right here in the United States in La Porte, Indiana.

www.h-l-w.com (http://www.h-l-w.com)

So there's still at least one toy company sticking out and building everything here at an affordable price with a good quality product in the USA. I have purchased a number of the products.

On a more serious note, not all of us care much for model trains which is acceptable and understandable. But have you ever needed to get your wife or daughters any gifts for valtentines day/ christmas and not know what to get? Well Vemont teddies build high quality custom teddy bears and their made in Vermont.

http://ir.vtbearcompany.com/index.php?id=141

So you see there are still companies left that where most have gone to China they still make their products in the US.

And if I may add one more,

for made in USA clothing try www.unionjeancompany.com (http://www.unionjeancompany.com)

that's right, an American company that still makes clothes.:flag:

[chuckled]

There is a certain demand for cars that will be sold in the US and if the workers in Toyota, Honda, etc. plants were not building those brands, they would be assembling American cars to meet the demand. The Japanese and Germans waged WAR on the US and are still gunning for us in economic terms. I will not contribute to those efforts. The bought off writers and editors who bash American and praise imports are off base. Unless you are going to race your car what difference does .1 second make from 0 to sixty. This stat is totally subjective anyway because of different drivers and conditions. Minute differences like this are used to "rate" one car over another. I think that I am capable of choosing the car best suited for me. And yes, it does matter where the profits end up. Think schools, roads, social security and on and on. Most people working in America depend on workers spending American dollars to make a living yet they are spending their money on products that line the pockets of off shore companies. Doesn't compute for me. Until recently, I considered Canada just an extension of the US. Canadians spend a lot of money in the US and have supported us and been our partners. Not so much anymore, there is a lot of bashing going on up there.

[jefferson-mo]

Hello.....Our cars are foreign.....CANADIAN!!!:bows:

Thanks you Canucks!!:beer:

Marauderjack:burnout:

UAW588.............you listenin?

we actually have 2 Canadian cars now.............


And my Subaru(which I no longer have) came from Japan on a Norwegian ship....but used American Union Labor to get it ashore and then to me......

1.Union Harbor Pilot to get the ship from the Pacific Ocean to the Harbor of Portland Oregon

2. Union Tug operators to get the Ship to the dock

3. Union Dock workers to get the shipment form the ship to the dock

4. Union truck drivers to get the cars to the local Distribution Center to be finished for 'Final Assembly'(whatever that means)

5. more Dock workers to unload and re-load the trucks to the dealers

6.American Car dealer employees to prep my car and sell & deliver it to me(local jobs)

7. It's my hard earned money and I should be able to spend it my way.....build a better product I'll buy it, I don't care where it came from(I had my Sooby 2-1/2 years and never need to take it to the dealer for any repairs, squeaks rattles or poor paint)

my .02 as an American

[Mike M]

I have never taken any American car I have owned since the first "new" car I bought (87 Turbo T-Type...I still own it-Grand Marquis-2 Lincoln Town Cars-and of course my Marauder and my new Hemi Durango). Can't get much better then that!

God Bless America!!!!!!

[dwasson]

7. It's my hard earned money and I should be able to spend it my way.....build a better product I'll buy it, I don't care where it came from(I had my Sooby 2-1/2 years and never need to take it to the dealer for any repairs, squeaks rattles or poor paint)

my .02 as an American

My wife has had a few Hondas, one built in Canada, one in Ohio, and one in Japan. They have all been as reliable as hammers and never let her down. Our Kia Sedona van has been good for us and not given us any problems that we didn't cause ourselves.

I can't say that about the last 6 or 7 cars from the Big 3 that I have had. The Marauder is a two ton collection of squeaks and wind noise. My Chrysler Cirrus has been nothing but trouble since it went past 70K miles. I don't believe that any of the domestic cars I've had will be driven at 150K miles. I just saw my wife's old '88 Civic the other day, still going down the road at 325K miles.

So, my question still is:

How many cars that I don't want, should I buy to protect the jobs of people who make more than I do?

[Mike M]

So, my question still is:

How many cars that I don't want, should I buy to protect the jobs of people who make more than I do?

A better question may be.....
How many cars that I don't want, should I buy to protect the jobs of people who live somewhere other then the USA????

I have never seen or drove a import that I wanted to buy.
My Marauder doesn't squeak or rattle, except the time I had to grease the hood last year.
Also I don't really mind if people make more money then I do, I don't let that stop me from buying things. I know my doctor makes more then I do but I will still go to him if I get sick.
You cant compare a Marauder to a Honda, the Marauder has style!

[dwasson]

A better question may be.....
How many cars that I don't want, should I buy to protect the jobs of people who live somewhere other then the USA????
I don't buy anything to protect anybody's job. I buy what I believe gives me good value.



I have never seen or drove a import that I wanted to buy.
If everyone wanted them they would be too expensive.


My Marauder doesn't squeak or rattle, except the time I had to grease the hood last year.
Also I don't really mind if people make more money then I do, I don't let that stop me from buying things. I know my doctor makes more then I do but I will still go to him if I get sick.

Making more than I do isn't an issue until they ask me to sacrifice for them.



You cant compare a Marauder to a Honda, the Marauder has style!

Style won't keep warm and dry when you are broke down in the rain.

[bigslim]

I don't buy anything to protect anybody's job. I buy what I believe gives me good value.


If everyone wanted them they would be too expensive.


Making more than I do isn't an issue until they ask me to sacrifice for them.



Style won't keep warm and dry when you are broke down in the rain.
I have never been stranded in the rain by my MM. I never been stranded in the rain by my PT.

I will not get into this topic anymore. It has been done over and over and over. If you don't like domestic cars don't buy them. There is nothing wrong with the American cars.

I guess this is another reason why I am getting tired of this site. There is a lot of bashing. Working for the auto industry I am getting sick and tired of hearing how great the Japenese cars are. If you like them so much move over there. Buy a Japanese car and make sure you fly your "Red,White and Blue" flag on it.

It cracks me up how I hear we should "support our troops" but who supports my troops? We are fighting a senseless war over seas and I hear we should support the war. We have a war going on right hear but who supports it?

Dan, maybe Toyota or Honda will pay your unemployment next time you get laid off. :fire:

I'm out of here!

[Mike M]

I don't buy anything to protect anybody's job. I buy what I believe gives me good value.

I agree, that's why I buy American!




If everyone wanted them they would be too expensive.
If everyone wanted them we would not be driving Marauders.


Making more than I do isn't an issue until they ask me to sacrifice for them.
Not sure what you mean by sacrifice, if driving a Marauder is sacrificing...count me in!!!



Style won't keep warm and dry when you are broke down in the rain.
I never broke down in the cold-rain-hot-snow but it's amazing what style can do for you.

[dwasson]

I guess this is another reason why I am getting tired of this site. There is a lot of bashing. Working for the auto industry I am getting sick and tired of hearing how great the Japenese cars are. If you like them so much move over there. Buy a Japanese car and make sure you fly your "Red,White and Blue" flag on it.


I'm not bashing, I'm defending myself against a mindless "Buy American" meme.

[Mike M]

I'm not bashing, I'm defending myself against a mindless "Buy American" meme.
Who's mindless?

[dwasson]

From:http://www.fff.org/comment/com0412j.asp

“Buy American” Hurts Americans
by Sheldon Richman, December 29, 2004

President Bush has a plan to address the so-called trade deficit, which worries people so much. According to the wire services, Bush said, “People can buy more United States products if they’re worried about the trade deficit.”

That will appeal to many Americans in a nationalistic fever. What could make them feel better than passing up inexpensive, high-quality, foreign-made products and buying pricier, American-made counterparts? But it won’t help the economy or the American people in general.

Frankly, I can’t tell whether President Bush is kidding or not. His phrase “if they’re worried about the trade deficit” implies that he doesn’t seriously mean what he said. But either way he has erred big time. If he means it, then he has fallen for one of the silliest fallacies imaginable. And if he doesn’t mean it, then he is deliberately propagating that fallacy. A president should be more careful.

The facts are these: “Buying American” doesn’t help “America,” and buying foreign products doesn’t hurt “America.” It takes the most naive form of collectivism to believe the opposite. To put it another way, the trade deficit is nothing that needs resolving. It’s a deficit only because not everything is being counted. If you only looked at your expenditures and ignored your income, you’d be horrified by your personal deficit. But of course you would be missing the full picture.

The so-called trade deficit refers to the current account, which keeps track of Americans’ exchanges of goods and services with people in other countries. If in the aggregate during a given calendar year, the dollar value of the goods and services we buy from foreigners exceeds the dollar value of what we sell to them, that difference is said to be the trade deficit.

But this is obviously a half-told story, because foreigners can do things with the dollars they earn other than buy American goods and services. They can invest in the United States by purchasing stock in companies or corporate bonds. That’s good for Americans because it helps create new products and job opportunities. Foreigners can also buy government securities. (There’s an easy way to keep foreigners from being creditors for the U.S. government, if that bothers anyone: stop deficit spending.)

The point is that when you count everything — purchases, investments, and dollar holdings — the books must balance. It’s an accounting certainty.

But surely “buying American” can’t hurt, can it? Yes it can. It can hurt particular groups of Americans. If we buy Toyotas and Hondas, Japanese people will have dollars with which they can buy, say, American lumber. (They can’t spend dollars in their supermarkets.) But if a wave of counterfeit patriotism sweeps the country and we buy only American-made cars, those Japanese won’t have the currency they need to buy the lumber. The lumber companies will have fewer sales and will lay off workers. Has America been helped by the “Buy American” policy? Not at all. Some Americans will benefit, but others will suffer.

We live in a global marketplace with a vast division of labor — the greatest exercise in worldwide cooperation ever seen. Nations don’t trade with each other. Individuals do. Just because two people are Americans, it doesn’t mean their interests are identical. If a Japanese auto corporation offers me a vehicle with the features I want at a price I like, I have a harmony of interest with that group of Japanese. “Buying American” would not make me better off. But it would hurt some Americas: remember the lumber workers.

If American automakers get the government to make it harder for me to buy a Japanese car, my interests are hardly served. So how can that policy be said to be in America’s interest?

It is time we got over the trade foolishness that is displayed daily in the nation’s newspapers and news programs. Voluntary exchange is good for buyers and sellers, or it would not take place. That the parties live in different countries is irrelevant.

To understand economics, you have to look beyond the immediate effects. “Buy American” hurts many Americans. Buying imports maintains and creates American jobs. Lose your guilt. Buy what you like.

[duhtroll]

Nice theory, except trade values ain't equal between countries. If they were, I'd say that argument held some credence.

If everything were classified fairly by worth, it would make for a level playing field. It ain't, so uh, it ain't. There are so many million variables in this equation I'm not sure anyone could calculate it all.

The US gives away more to other countries than we ever get in return, both via trade and otherwise. The money doesn't always come back to the US in your example, because we don't require it to do so in our trade agreements. At least that's how it seems. Maybe someone with more knowledge on the subject could chime in?

EDIT: I know when my wife and I set up some new mutual funds, we didn't go with US companies. I went with China and she went with some EUs. Those funds are making more than the US ones. Better economies right now.

[Mike M]

“Buying American” doesn’t help “America,” and buying foreign products doesn’t hurt “America.”

No matter how many times I read that it doesn't make sense to me. I guess if you Google long enough you can always find someone to agree with you, no matter how strange it sounds.

[MikesMerc]

No matter how many times I read that it doesn't make sense to me. I guess if you Google long enough you can always find someone to agree with you, no matter how strange it sounds.

That's utter BS.

In fact, Dan didn't have to google long to find that article. Why? Because every economist worth their salt beleives the same thing. They understand the economic forces of global trade. The ONLY folks who get worked up about the trade deficit are the news media because it sells papers and tv advertising to the weak minded. The topic also makes great politcal cannon fodder for the same uneducated masses.

Do some reading. And I'm not talking about CNN, MSNBC, or Fox news. There are plenty of good articles on world trade, both US and foreign sourced that will enlighten you.

Make no mistake, a global economy DOES hurt specific groups of people within individual industries...no doubt there. But, the point you are missing is that, by and large, open world markets free of protectionist legislation, benefits all world economies including the USA. There are industries within the US that have boomed simply because of foreign investment and purchases of US technology and services. If US consumers had not purchased some measure of foreign goods in the first place, these other countries would not have the purchasing power to buy from the US.

What's so hard to understand about that?

Furthermore, the "trade deficit", which had been simply defined by the media as "the US buys more from foreign sources then foriegn sources buy from the US" makes absolute economic sense and is NORMAL. The US economy is the largest in the world.....by a HUGE margin. The resulting purchasing power is what allows US consumers to run this deficit. Athough in simple "trade dollars" we may be buying more than we are selling, our economy is simply generating more GNP than anywhere in the world and this buying power has to be channeled somewhere. When you have more purchasing power than anyone else in the world, (at a staggering 2:1 ratio with the next largest economy in the world ) it makes sense that some of this buying power will be channeled outside the US creating a deficit.

http://www.mercurymarauder.net/forums/attachment.php?attachmentid=92 25&stc=1&d=1149341886


This is not to say that the global ecomony does not bring challenges. The latest predictions has China overtaking the US in GNP by 2050.
http://www.mercurymarauder.net/forums/attachment.php?attachmentid=92 26&stc=1&d=1149341995

This means that our domestic economy must make adjustments so that as other countries rise in economic power, and the gap narrows, we need to make sure we have the goods and services to remain a top trade partner. This is the challenge....not americans buying american, but amercians selling to the world.

The global economy is an equalizing force. It is raising the standard of living around the world....and bringing the US and other powerhouses down at the same time. World economies are being drawn to the "middle" by natural market forces (labor costs, material costs, transit technologies, education, etc, etc).

One last point. Before we freak out about China taking over the world, remember that it was japan that was going to take over the world in the early 80s. What happened? Natural market forces happened. The same forces China is facing and will be facing increasingly over time. Japan went into economic meltdown with hyper inflation because they were too successful too fast. Standards of living jumped too high too fast. Japan has been in a 1% economic growth pattern for the last decade because of it!! China will be faced with the same thing trying to avoid meltdown. Given their closed governement style and unique level of government control, they may be able to hold back the tide of consumerism. They hope so anyway. Because if 1.3 billion people decide they went a better lifestyle, and they start earning wages to get it, China will meltdown within a few years.

BTW, for anyone that cares, know that I make my living from the US auto industry. My children's future rides on it. But, I will not push "buy american" because it makes no sense to fight the natural global economic forces and in the end makes america less of a global trading partner. Something it desperately must be over the next 20 years. Instead I push for open market legislation and reduction of trade barriers...things that will help the US auto makers. There are plenty of foreign trade barriers that need to come down. This should be our focus, not "buy american." I've learned this not by listening to the news hype, but by being active on various economic panels such as the Detroit Economic Club and the National Economists Club. Check out there websites and do some reading. They are not politcially aligned nor are they trying to sell news.

[Bluerauder]

Why is it that I have problems with believing the accuracy of GNP numbers from a company that spells Canada with a "K" ??? :o I also thought that GNP was not used much anymore and that the current measure is GDP (Gross Domestic Product). I wonder how these figures stack up on a per capita productivity basis. :confused:

[MI2QWK4U]

I think everyone has had their say, reads like a political thread and they are not allowed per the boss. Tear each others throats out someplace else.