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Post by mdub on Aug 3, 2010 15:10:38 GMT -6
I just read a Dean Baker column on Cunterpunch. The article was right on, until the last paragraph, when he argued for another round of stimuls. If the first round of stimulus failed, what makes him thing another round will do the trick? It's amazing to me how an economist can be so oblivious to the damage done to the US economy caused by NAFTA, the WTO, favored trading partner status for China, open borders, and work visas for foreigners. www.counterpunch.org/baker08032010.html
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Post by unlawflcombatnt on Aug 3, 2010 15:41:41 GMT -6
I just read a Dean Baker column on Cunterpunch. The article was right on, until the last paragraph, when he argued for another round of stimulus. If the first round of stimulus failed, what makes him thing another round will do the trick? It's amazing to me how an economist can be so oblivious to the damage done to the US economy caused by NAFTA, the WTO, favored trading partner status for China, open borders, and work visas for foreigners. In general it was a good article by Baker, especially how he characterizes the fleeting nature of inventory growth and its effect on GDP and the economy. But I agree with you. Stimulus does no good whatsoever if it leaks out into import purchases, or upward into non-productive financial speculation. And that's exactly what's happening. Our trade deficit increased by a huge amount in the 2nd quarter, meaning that US stimulus money was leaking out into foreign production markets and creating jobs in foreign countries--not in the US. Meanwhile, most of the remaining stimulus money "leaked" upward into financial assets and stock prices. We're better off having no stimulus at all, if it's going to be wasted on imports and paper wealth expansion. Without any new stimulus spending, we'd could at least preserve our remaining borrowing and spending power until it could be better directed. Ultimately, we're going to need to put up high Tariffs, if not an outright embargo, on all foreign manufactured goods. We've got little to lose in a trade war, as the countries whose imports we'd block buy little from us anyway (China, Korea, Vietnam, Japan, Ireland, etc.). If those countries stopped buying US goods, who cares? They're buying almost nothing but raw materials from us to begin with.
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Post by mdub on Aug 3, 2010 18:40:42 GMT -6
I heard someone say that to enact tariffs we would first have to have the WTO approve it. I tried doing some research but couldn't find out if it was true or not. He was suggesting that the US use a progressive tax that increses on a company the more it produces overseas, but he said this may encourage US companies to move entirely offshore to avoid the tax.
Another thing we could do is to forbid selling goods and services in America unless they are designed, manufactured, and engineered in America.
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