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Archive for November 11th, 2018

It’s not quite what you imagine it to be. President Trump is right to shout to the Twitterverse about how its trade deficit with China is costing the United States trillions of dollars and millions of jobs every year.

According to a recent study by the progressive Economic Policy Institute (EPI), which is hated by the conservatives and corporate Democrats alike, “…the growing trade deficit with China…has cost the U.S. millions of jobs throughout the economy since China entered the World Trade Organization (WTO) in 2001, a finding validated by numerous studies.”

Of course, EPI did not report a few things that are important to their study, and for our interests. So, as you read through a few of the EPI highlights below, I will make comments here and there in bolded letters. However, let me state there are a few things in this report that are not mentioned, and the corporate news media do not want you to know.

  • The U.S. trade deficit with China does not really exist in the sense that it is a trade deficit between China and the United States. In reality, the trade deficit is really between US corporations that manufacture their goods and services in the U.S.A. and U.S. corporations that have exported U.S. jobs to China and then exported their-made-in-China goods and services to the USA.
  • Another thing not mentioned is that a variety of studies show the export of every 100 manufacturing jobs from the United States results in the loss of an additional 300 to 1700 U.S. jobs.
  • The difference between the old higher wage exported U.S. jobs and the new lower wage Chinese jobs goes straight into the pockets of the billionaires who control both major political parties via higher corporate earnings, rising share prices, and surging dividends. Thus, much of the income and wealth inequality of recent history is the deliberately negotiated end result desired by corporate-backed U.S. politicians and U.S. negotiators.
  • Currently, three people (Jeff Bezos, Warren Buffett, and Bill Gates) own more wealth than the bottom fifty percent of US citizens. Much of this is caused by the so-called trade deficit with China.
  • Trade treaties are negotiated so that US corporations can export jobs, as well as create them over there rather than over here, and this also helps to manufacture U.S. income and wealth inequality.
  • Pretty much 100 U.S. billionaires control both major U.S. political parties and quite naturally they have rigged the economy using the corrupted U.S. government, and especially a remarkably corrupt corporate wing of the United States Supreme Court, which includes two well-known perjurers in Brent Kavanaugh and Chief Justice John Roberts.
  • In other words, the income and wealth inequality we experience has been caused by the corruption of all three branches of the federal government, which could not have occurred without the complete corruption of the corporate news media.
  • Currently, the 1 percent steal somewhere between 22 to 38 percent of all the income produced in the United States, up from roughly 8 percent in 1980.

Here are a few of the highlights of the recent EPI report:

1. U.S. jobs lost are spread throughout the country but are concentrated in manufacturing, including in industries in which the United States has traditionally held a competitive advantage. Think Nike, Microsoft and Apple.

2. The growth of the U.S. trade deficit with China between 2001 and 2017 was responsible for the loss of 3.4 million U.S. jobs, including 1.3 million jobs lost since 2008 (the first full year of the Great Recession, which technically began at the end of 2007). Nearly three-fourths (74.4 percent) of the jobs lost between 2001 and 2017 were in manufacturing (2.5 million manufacturing jobs lost).

3. The growing trade deficit with China has cost jobs in all 50 states and in every congressional district in the United States.

4. The trade deficit in the computer and electronic parts industry grew the most: 1,209,000 jobs were lost in that industry, accounting for 36.0 percent of the 2001–2017 total jobs lost. (Think Dell Computers, Apple, Microsoft and a lot more.)

5. Surging imports of steel, aluminum, and other capital-intensive products threaten hundreds of thousands of U.S. jobs in key industries such as primary metals, machinery, and fabricated metal products as well.

6. Global trade in advanced technology products—often discussed as a source of comparative advantage for the United States—is instead dominated by China. This broad category of high-end technology products includes the more advanced elements of the computer and electronic parts industry as well as other sectors such as biotechnology, life sciences, aerospace, and nuclear technology. (This is because Dell, Apple and Microsoft, among many other US high-tech corporations, have exported millions of US jobs to China, or created them there rather than here, and then exported their Chinese made products to the USA.)

7. In 2017, the United States had a $135.4 billion trade deficit in advanced technology products with China, and this deficit was responsible for 36.1 percent of the total U.S.–China goods trade deficit that year. In contrast, the United States had a $24.5 billion trade surplus in advanced technology products with the rest of the world in 2017. (See number six in bolded letters above.)

8. Growing trade deficits are also associated with wage losses (in the USA) not just for manufacturing workers but for all workers economywide who don’t have a college degree.

9. Between 2001 and 2011 alone, growing trade deficits with China reduced the incomes of directly impacted workers by $37 billion per year, and in 2011 alone, growing competition with imports from China and other low wage-countries reduced the wages of all U.S. non–college graduates by a total of $180 billion. Most of that income was redistributed to corporations in the form of higher profits and to workers with college degrees at the very top of the income distribution through higher wages.

The China toll deepens–Economic Policy Institute

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