Originally posted by an0nThinker
Although export based models have their problems they do have some advantages. The population learns to innovate through manufacturing and hones
skills for competition.
I disagree, if we look at nations like China. There are 100 million people employed in China, where the manufacturing output is roughly equal to that
of the United States. Yet the US has roughly 12 million people employed in the manufacturing industry. This means that it takes roughly 11 Chinese
workers to equal the productivity of 1 US worker.
Additionally, manufacturers in the United States are the most productive in the world. The US has by far and away the most fortune 500 companies of
any country out there (132, which is twice the amount of the second largest country, China; which really has nothing more than state owned
If we look at expenditures in R&D, as well as Scientist and Engineers by country, the US spends way more ($400+ billion annually. The second largest
spender is China at $160 billion) and equates to at least one-quarter of all the worlds Scientist and Engineers...And don't get me started on how
dominate US higher education is compared to the rest of the world...
It also keeps the median wages high unlike the US where our super rich hold most of the wealth.
Please tell me you're not referring to the godawful video making the rounds where it literally pulls numbers out of a hat...It is true that the US
has a wealth gap. But what country doesn't?
If you bothered to check the source for the median income figure I provided; the US has the highest median income of any country. We also have the
highest disposable wage of any country. I also hope you understand the difference between 'wealth' and 'income'.
The fed gives money to the banks to lend. There is more debt than money. This is called cyclic debt. Meaning all the money we have cannot pay
our debt. We pay other countries off by printing more dollars through the use of petro-dollar. There will always be a net positive outflow of dollars.
This is a dollar tax on the rest of the world. Example China wants to buy oil, they buy US dollars(in actuality they use their reserves that we paid
in printed cash and promissory notes) that we printed. They go to the Saudis and give them the dollars. Why should 2 sovereign nations be forced to
use the dollar? This creates a method of taxation all over the world.
Lets get a few things straight here: The debt is a cumulative factor; whereas GDP is an annual measure. To get a better understanding of this nations
finances, you would have to look at overall financial assets of $90 trillion
(some estimates have US national assets as high as
) and subtract the debt outstanding from that. This is how you gauge a nations financial position long-term. That along with
an annual GDP of $16+trillion every year, makes the greenback the preferred currency. We also have a relatively stable system of governance contrast
to the rest of the world. This in turn makes the US a good investment.
Now I know your outlook on BRIC is not that positive however we are still talking about 3 billion people with about half of them starting to be
in the middle class. Why would they let us impose a taxation on them by force once their economies start becoming bigger?
Because their economies aren't going to 'become bigger'. The BRIC's future relies on an overly optimistic view on China...(and India to a much
lesser degree) which as I already pointed out, isn't going to end well for the BRIC's. China ( the biggest player) is basically Japan version 2.0 in
how they are building their economy. They depend entirely too much on fixed investment led growth, which defies free market principals on its most
basic premise! You don't build that which you cannot sell. What happens when you do? You face massive overcapacity and a non-performing loan
Also interesting is how China counts GDP. They count GDP as "before market" instead of "after market". Which means that if they build an entire
ghost town full of EMPTY new skyscrapers and apartments, but no one buys 6 years after they've been completed...this is still measured as GDP growth
in China. Here in the West, we don't consider this actual growth until after market...meaning the sales transaction has been completed. This is how
real growth is measured. By sustainable economic activity. As Ju Jintao explained: "Chinas growth is unsustainable, lopsided, and unblanaced." In
order to sustain current growth in China, the country is reinvesting literally half of its GDP just to meet the current (failing) growth
targets...tells you something about the China 'miracle'...