There are two great debts the American people have, yet there is only one the nation talks about. These twin debts are the national debt—money borrowed from the nation against itself compiled with money borrowed from other nations—and the trade deficit: money given to other nations for imported products and services that will, at some point, come back to buy out the United States.
Tag Archives: Trade Deficit
In 1950 one out of every three American workers was employed in the manufacturing industry. America was the manufacturing superpower of the world, and our middle class was both booming and enjoying a high standard of living. We were the richest and most productive country in the world.
One of the main reasons our Free Trade Agreements (FTAs) do not work is due to the fact that other countries immediately implement a value-added tax system after joining the World Trade Organization (WTO), while the U.S. still has not implemented a VAT. Free Trade Agreements either eliminate all or most of the tariffs between two countries. Once a country joins the World Trade Organization (WTO) that country then almost immediately implements a VAT system or raises their VAT to replace their tariffs. The VAT acts just like a tariff but is entirely in line with WTO standards. The result of this system is that American exports are essentially economically blocked by other nations.