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during the cold war, the soviets owned nearly a trillion dollars worth of our debt, and we were importing $69 Billion worth of russian goods each year? obviously, i'm speaking of our current relationship with china.

and really it's amazing to me how quickly america has become the junior member in our relationship with the chinese. just think about this. in 2000, we were importing $16 Billion in chinese goods, and in 09 - less than a decade later - it was $69 Billion.

and it amazes me how easily china has overtaken us. but what is their secret? in truth, all their doing is what a nation's government is supposed to do. putting themselves first. this isn't a novel idea, but it is something our own government hasn't been doing. for instance, 50 years ago, nearly a third of u.s. employees worked in factories. today, little more than a tenth of u.s. employees work in manufacturing. that means we don't make anything anymore. instead, four fifths of our workforce work in the services sector.

look at this chart of our trade deficit.



now admittedly, this trend has reversed a bit since the beginning of the great recession, but that's only because the economy is bad. this has traditionally been the case during economic downturns, as you can see at the time of the 01 recession.

how can a country prosper when it buys more than it sells?

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IMO, the only way to pull all of it out of the toilet is to focus on renewable energy sources and manufacturing of those sources in the US.  We have been in denial for way too long.  While we sit around and refuse to accept our dirty energy sources are killing all that sustains, we get deeper in debt, less innovative and look like assholes in the meantime.  

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but i don't think we really have a viable alternative at this point. we thought it was ethonol, but now even environmental scientists are telling us it's too dirty, and not cost effective. solar is costly, and doesn't produce enough energy. hydro electricity isn't seen as green anymore, because it messes with the ecology of the rivers and streams it impedes. wind has the same drawbacks as solar. nuclear obviously gives off nuclear waste, which has to be stored somewhere. and obviously all the electric cars have to draw their power from the grid. we couldn't totally switch to hydrogen, because it's too expensive, and not enough of it is out there to supply our needs. i think our best bet as far as energy goes is that fusion reactor they're working on, but that's still a long ways off.

in short, i don't think there's any way (currently at least) that an industrialized civilization can live in harmony with good ole mother earth. the only solution would be living as the amish do.

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Set up a wind farm in Congress? Should solve your energy needs for the next decade or so :-P

Even in renewable energy, the Chinese have been investing billions in the field in the last few years, so chances are that if you're setting up a wind turbune or a solar panel array somewhere, it'll have a little "Made in China" sticker on it....

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Originally Posted by Lelania Bailey:
IMO, the only way to pull all of it out of the toilet is to focus on renewable energy sources and manufacturing of those sources in the US.  We have been in denial for way too long.  While we sit around and refuse to accept our dirty energy sources are killing all that sustains, we get deeper in debt, less innovative and look like assholes in the meantime.  

I totally agree that renewable energy is vital to the success of our country.  We simply have to throw off the yoke of oppression that has been hung around our necks by the likes of OPEC.  Here are some figures I found interesting:

73% Americans believe we can have both a healthy economy and environment.

79% believe we can solve our environmental problems faster and cheaper with innovation and new technology than with litigation and more govt regulation.

72% believe that entrepreneurs are more likely to solve our energy and environmental problems...than the bureaucrats in Washington.

68% agree that we don't need to raise taxes to clean up our environment.

79% of Americans support giving large financial prizes to companies and individuals who invent knew ways to cut pollution.

90% support giving tax credits to home owners and builders who incorporate alternative energy sources in their homes (ie...solar, wind and geothermal energy).

77% Americans support building more oil refineries in America to lower the cost of gas and throw off our dependence on foreign oil.

65% support building more nuclear plants in this country (to cut carbon emissions and further reduce our dependence on foreign oil).

The current strategy of relying on carbon tax increases, govt regulations, control by beauracracies, and litigation by trial lawyers are policies that focus on pain...not reward.  These policies drive business away from American shores!

America needs an energy strategy that will marginalize the oil dictators, reduce the amount of carbon emitted into the atmosphere and create a more productive economy!  We need to implement ways to encourage business to come back!  And also to use green strategies.

So which strategies might we come up with?

I agree with Newt Gingrich that there should be tax breaks for companies that invest in both ethanol and hydrogen stations and pipelines across the US.  This would result in the ability to deliver fuel to automobiles at a reasonable cost.

There ought to be tax breaks for auto companies to retool in favor of composite materials manufacturing (which would radically lower the weight of autos and improve gas mileage).

Again...instead of punishing companies by massive regulation, we should instead give companies a good reason to want to invest in green energies.  (This would also mean putting Americans back to work, thus reducing unemployment).

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Originally Posted by Dødherre Mørktre:

and it amazes me how easily china has overtaken us. but what is their secret? in truth, all their doing is what a nation's government is supposed to do. putting themselves first. this isn't a novel idea, but it is something our own government hasn't been doing. for instance, 50 years ago, nearly a third of u.s. employees worked in factories. today, little more than a tenth of u.s. employees work in manufacturing. that means we don't make anything anymore. instead, four fifths of our workforce work in the services sector.

look at this chart of our trade deficit.



now admittedly, this trend has reversed a bit since the beginning of the great recession, but that's only because the economy is bad. this has traditionally been the case during economic downturns, as you can see at the time of the 01 recession.

how can a country prosper when it buys more than it sells?

Well...you're right Dod.  We have to put Americans back to work.  We have to start building things again.

But how to do that?  

We have to encourage businesses to bring back jobs to our shores.  

1. Cut corporate taxes.  Americans suffer from the 2nd highest business tax rate in the industrialized world.  The Fed rate is around 35% and the states pushing it close to 40%.  However the average corporate tax rate in the EU is around 24%.  

So if you own Levis...where would you rather manufacture?  Here and pay 40% taxes, or in some other country?  Hire their workers and stimulate THEIR economy.

We need to drop out tax rate to around 12.5%.

2.  Instead of increasing Capital Gains taxes by 66% (as the Dems propose), we need to abolish them altogether, both for individuals as well as corporations.  By double-taxing income, the capital gains tax discourages the venture capital that feeds start-ups and creates jobs.

With those 2 measures alone, America could become the most desireable country in the world in which to invest and start a business!  And put Americans back to work!  (And Americans with money in their pockets...spend it, thus stimulating the economy).

3 To alleviate the unemployment crisis, we should cut federal payroll taxes by 50% for 2 years. This would provide immediate, powerful relief to small business that create the most jobs.

4.  Kill the death tax.  Obama and the Dems are adamant that we have a death tax of over 45%.  But taxpayers have already paid considerable taxes on money saved over a lifetime.  Now, when you die, they want to hit your children with ANOTHER tax!  Taxing it again is abusive and unfair.  No one should see their lifetime of hard work and careful saving confiscated by the govt.

5. We shouldallow businesses to write off their productive investments for one year.  Tghis should lead to massive investment in new equipment and technology.  It will ensure that American workers have the most modern and productive equipment  in the world.

6. We should imnplement the energy policies I mentioned above.  This would create thousands of jobs for Americans.

7. Go back to Reagan stuyle strong dollar policies, guaranteeing that the dollar once again become the world's reserve currency, ensuring lower interest rates, and more long-term capital investment.

8.  Cut Federal spending by at least $180 billion dollars and adopt a budget plan that cuts future federal spending by $1 trillion.  Terminate TARP and all bailouts and repeal all unspent stimulus funding.

these measures should result in a booming economy and allow us to balance the budget in a around 7 years.   It would also cut unemployment by 3-4% and restore long-term growth.

I also like the idea of an optional flat tax with personal exemptions of $12,000 or so per person.

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i heard an interesting fact on the news yesterday. the winner of the 2009 nobel peace prize (obama), is hosting an official state dinner for the man who is imprisoning the 2010 nobel peace prize winner (Liu Xiaobo).

and that got me to thinking. what exactly has china done to deserve an official state dinner? they haven't helped on NK, they haven't helped with iran, they haven't done anything about their human rights abuses, they haven't done anything about their undervalued currency, they haven't really done anything for us. yet obama continues to play mr. nice guy with them. i'm not saying he shouldn't have a dialogue with the chinese prez, but why kiss his ass with an official state dinner when the same hasn't been extended to most of our closest allies? not japan, not the uk, not canada, only china, india, and mexico.

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this illustrates my point perfectly. we bail out GM, and then they turn around and announce that they're investing over half a billion dollars to build low emission engines, and create 500 new jobs.....in mexico. way to go GM!

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Originally Posted by Lelania Bailey:
IMO, the only way to pull all of it out of the toilet is to focus on renewable energy sources and manufacturing of those sources in the US.  We have been in denial for way too long.  While we sit around and refuse to accept our dirty energy sources are killing all that sustains, we get deeper in debt, less innovative and look like assholes in the meantime.  

I find this laughable at best. What is renewable energy? Solar panels are not renewable, they create terrible point pollution when disposed and are non-green to manufacture. Plus they are not reliable. Similar story for wind towers, but wind towers have the added problem of killing birds (potentially to the point of extinction) and needing special soil conditions to be built in the first place.

And my second comment, how does burning coal kill?  Already the UN has admitted that global warming is a hoax by changing it to "global climate change" (ref. moving the goal posts). Do you consider nuclear energy a "dirty" energy? How about trash incineration? That provides energy.

Really the problem is I don't think you understand that there is no such thing as "clean" energy. Everything has a trade-off environmentally speaking. Everything costs something. And to use the word "clean" as an objective scientific term is laughable.

We should have electric or natural gas cars, and a nuclear power plant in every town.

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Hope no one minds, but for clarification, I'm opening a new topic on renewable energy.

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Originally Posted by Dødherre Mørktre:
how can a country prosper when it buys more than it sells?

What is China's secret?  It cheats.

Here are some of the problems we are having with China.

The U.S. claims an undervalued Chinese currency makes Chinese exports to the U.S. cheaper and American exports to China more expensive, widening the U.S. trade deficit.

Market Access
A series of trade restrictions imposed by the Chinese government within China have angered many American manufacturing and high-tech companies, which are rapidly finding themselves cut out of the world’s fastest growing market.

China's Protectionist Industrial Policy is expanding.  
China attempts to use regulations to block Western companies from selling their products to Chinese government agencies, and new rules force us to give up technological secrets in exchange for a piece of China's market.

An example: China used to import close to 100% of its wind-power turbines. Now it makes close to 75% of those that are sold in China. Chinese firms haven't developed wind-turbine technology; they've just required that foreign firms selling turbines in China share that technolog, and now their firms manufacture the turbines at a lower cost.  (That's like demanding Coca-cola give up its formula to China if they want to sell in that country).

Trade Violations
The United States and European Union accused China of unfair trade practices.
The United States trade representative, Ron Kirk, said China had imposed quotas, export duties and other costs on raw materials used in the production of steel, chemicals and aluminum. In effect, he said, China was putting its thumb on the scale and giving Chinese manufacturers an unfair edge.

They're stealing our technology, violating all sorts of patent-protection laws, hacking into Google, and infringing on intellectual-property rights. In fact, 80 percent of Chinese software is reportedly pirated from American companies.

Beijing has a trade surplus with the United States of about $183 billion (in 2011). The rule of thumb that every $1 billion in the trade balance represents the gain or loss of 10,000 jobs. Using that standard, the trade deficit with China could explain the loss of  more than 1 million American jobs.

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they're not cheating dennis, they just don't put the same restraints on themselves that we put on ourselves. we have this strange notion that they should be looking out for our "shared prosperity" but all they're looking out for is good ol' number one - themselves. just like we used to, back when we were a rising power. in other words, they're playing hardball, while we're in mamby pamby land.

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That's true.  I meant they are cheating us.  Stealing technology, etc.