< HOME  Friday, December 30, 2005

Bank and Bust

On 22 July 1999 Robert Scott of the Economic Policy Institute gave testimony on the US Trade Deficit before The Committee on International Relations Subcommittee on International Economic Policy and Trade. The published document was subtitled Are We Trading Away Our Future?

In his concluding section on policy recommendations he notes that although “U.S. workers have been hurt by globalization, U.S. multinational businesses have prospered. The soaring prices of U.S. stocks reflect the renewed worldwide dominance of U.S. companies.” He attributes US corporate dominance to aggressive overseas investment and outsourcing backed by US trade policy: i.e. the government, which he apparently regards as a success.

At the same time he is worried about how the “U.S. has suffered a declining share of world production and trade over the past four decades. In 1970, the U.S. produced 18% of world exports, but by 1998 the use share had declined to less than 14%,” which only seems confused unless you see that the US corporate dominance he extols above is the actual cause. That dominance was bought with outsourcing: “soaring prices of U.S. stocks reflect the renewed worldwide dominance of U.S. companies.” Homegrown manufacture falls, stocks rise, dominance ensured.

Then he goes on to find fault with the decline in US export. Imagine. He states: “Mexico now exports more cars to the U.S. than the U.S. exports to the rest of the world. And Mexico's largest exporter is,” guess who? “Daimler-Chrysler.” Remember this the next time you hear talk of US trade deficits: A US company is probably behind it. In Daimler-Chrysler’s case especially if talk is about Germany, as Scott’s charts show.

To round up, read the September 6, 2004 article A Long Term US Deficit by Robert J. Chassell of rattlesnake.com. He begins: “On a recent trip, someone asked me the long term consequences of current United States deficits. I probably spoke too long; but my key point was that current deficits make no rational sense unless you expect to abandon the United States in a generation. However they make excellent sense for individuals who plan to cash out within 10 or 20 years and desert the country.” And guess what? They, the multinationals, they’ve already left. They’re gone.

So ask yourself, Who’s “trading away our future?”


At Friday, December 30, 2005, Anonymous Anonymous said...

"Soaring prices of U.S. stocks" ????? What is he smoking? The final results are now in, and the Dow ended down, while the NASDAQ and S&P500 gained a tiny amount, with the Santa Claus rally failing to appear(source: www.bigcharts.marketwatch.com). Gold, on the other hand, ended up 18% for the year (source : www.kitco.com).

At Friday, December 30, 2005, Blogger yusuf chun said...

Yeah, but that was 1999, though. I don't know Doc. These people… Can't get my head around them.

At Friday, December 30, 2005, Blogger qrswave said...

The truth is probably somewhere in between. The index is down because many companies have lost ground. But, no doubt the one's who've outsourced have come out on top.

Nevertheless, it's hard to tell which news is truthful, and which is PR in disguise.

Ultimately, I think there is no question as to who the losers are in this picture.

jc, excellent graphic! Where'd you get it from?

At Saturday, December 31, 2005, Blogger yusuf chun said...

This comment has been removed by a blog administrator.

At Saturday, December 31, 2005, Blogger yusuf chun said...




At Saturday, December 31, 2005, Blogger yusuf chun said...

According to the National Debt Clock "The Outstanding Public Debt as of 31 Dec 2005 at 06:19:30 AM GMT is: $8,191,842,791,946.14

The estimated population of the United States is 298,120,036 [I'd lose at least one percent of that figure though: the filthy rich] so each citizen's share of this debt is $27,478.34."



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