Fair enough -Now tell us how to solve the 600 billion annual trade deficit without it hurting a little...
And don't tell me printing money to plug the hole as we have been doing for decades (kicking the can down the road) is the solution.
I have heard many complain, but I have not heard one single solution to the trade deficit. Your turn!
You can't resolve it, not quickly anyway. You think POTUS knows what he's doing on this? Farmers are already getting hammered on multiple fronts, with foreign customers going else where for soybeans, corn and pork, among other commodities, Trumps multi billion dollar one time bail out for farmers doesn't even come close enough to help them (their words, not mine). My industry is seeing some softening of demand due to price increases. Plugging the hole by printing money - we agree, that's a nonstarter.
There is no readily available solution. The absolute FACT is that our exports have dropped a little, over the last few months, and our imports went UP, even with Trumps stupid-ass tariffs (all of it in consumer goods). A solution for solving the trade deficit? Short of a massive recession to cut demand, that out strips U.S. suppliers capacity to manufacture at low prices that the market is demanding? Never going to happen. The fact is we have whole low price retail, on line and brick & mortar, built around cheap supply from Asia, including, but not limited, to China. Another fact is that the international auto industry's supply chain is built around different parts, coming from different countries, moving back and forth across international borders. This administrations moves to cut imports is disrupting a supply chain that can never move production quickly. Once a country of origin changes, on any vehicle part, due diligence demands long term testing for product liability and warranty liability reasons, plus anything in the power train has to meet further testing for emissions reasons. Those conditions are chiseled in stone, with very, very few exceptions. Parts supplier's contracts no longer allow for price increases due to raw material price increases, so now some suppliers very existence is threatened.
So resolve a huge trade deficit without it hurting a little? Can't be done, and it won't hurt a little - it'll hurt a lot and contribute to cause or exacerbating the next downturn.
Edited by Len_A, 06 September 2018 - 10:12 AM.