In an article by Alec Feinberg for Economyincrisis.org, he mentions Warren Buffett has been quoted as saying, “The U.S trade deficit is a bigger threat to the domestic economy than either the federal budget deficit or consumer debt and could lead to political turmoil…”. He goes on to talk about how while there are no examples in history of nations surviving running large trade deficits, there are many examples of nation's crumbling because they did.
That may or may not matter to you. However, if you are tired of the lackluster economy and the scary jobs situation in America, I have a great idea on how to fix it. Everyone should start buying American tomorrow. Think of it. We are the world's largest economy, and we are the major market for many countries. Unfortunately, we buy more foreign goods than we sell American goods. A lot more. This is called the U.S. trade deficit. For the last ten years we have averaged a yearly trade deficit of over a half trillion dollars. That is right--in excess of a half trillion dollars. If we made a concerted effort as a nation to buy predominantly American built items, we would turn that number around almost overnight. Then, guess what? Demand for American made goods would create a need to build those goods here. Obviously, this would create jobs. In a $14 trillion dollar economy, even a few percentage point change in the amount of goods bought from American made sources would mean billions of additional revenue dollars. This would translate into millions of jobs. We could solve all of our problems almost immediately if we would just wean ourselves from cheap foreign products.
Cheap. That's the one word reason for why people began to buy foreign goods. Because they were cheaper. The TV's made in Japan and China were cheaper than American made TV's. So when people started buying them, guess what happened to the American TV makers? They're mostly gone, that's what. The same thing happened to American stereo system producers. They were priced out of the market by foreign competitors. So the whole time we as a nation were buying the cheap products we were slowly but surely destroying our economy a little at a time. When U.S. automakers controlled 80% of the U.S. market, this country was on a roll. Now they control, I believe, about 47% of the market. Factories are shuttered and the government recently felt a need to launch a rescue of that industry. When we would see TV plants or auto factories close, we'd say to ourselves, "Whew, glad that wasn't me!" Well now the problem has become so acute that we can't ignore it anymore. It's not just happening to someone else, it's happening to many, many people. Well it's time to turn that around.
The problem won't be solved by government mandating that the people buy American goods, or by government putting tariffs on foreign goods. It has to be solved through persuasion, not coercion. When Americans realize that if they buy American made products they are helping assure the nation's future, then it almost becomes a patriotic act. People may pay a little more for American made goods due to our standard of living, but that would be offset by not buying so much junk being sold to us by the Chinese and other nations. "Junk?" you ask? Been to a Walmart lately? Do we really need all that stuff (for lack of a better word)? Look at the labels on pretty much anything in the store and look where it's made. Walmart is a huge reason why we have the problems we do. Once upon a time, Walmart actually ran an ad campaign saying they sold predominantly American made goods. However, they needed larger profit margins, so they started selling cheap imported goods. They are, the last time I looked, the largest retailer in America. They have helped create the mess we're in, all in the guise of trying to save you money. They never talk about the hundreds of thousands of jobs their policies have cost the American worker.
As I already stated, the average annual trade deficit of the United States is over half a trillion dollars. This is money coming out of my pocket and yours and, using various merchants as the middlemen, going into the pockets of people in other countries. I am just as guilty as anyone. I bought the cheap stereo systems, and I used to buy cars which weren't produced in America. But I've realized what that is doing to the country. We're selling ourselves out for trinkets!
So here is my suggestion. Let's all start paying attention to the labels which say where things are produced. If they say anywhere but America, think to yourself, "Do I really need this?" If the answer is "no", then put your money back in your pocket and spend it on something American made. Be careful, however. In my opinion, a Honda built in Marysville, Ohio and containing over 90% American made parts is an American made product, while, once again in my opinion, a Chevrolet made in Mexico is not. You have to look at the window sticker, you have to look at the label. The point is that these huge problems facing America can be solved, and this is one HUGE way to solve them.
