40,000 factories...think of that... If a "factory" is even employing 100 people, do the math... When factories support OTHER factories, though manufacturing things they buy from each other, and the "chain" breaks, whole communities crumble....killing off other businesses (not factories, but places the former factory-workers USED to frequent).
Remember when we used to MAKE textiles here? Were people unable to afford socks, sheets, towels, blankets, underwear?
When did we suddenly lose the "recipe" for socks?..or when did the public start clamoring for 79-cent socks, instead of 99-cent socks?
Remember when we used to make shoes here? Were people going barefoot because American shoes cost too much?
Remember when tires were made here?
Radios?
TVs?
Sewing machines?
Bicycles?
The people who worked in those factories supported families with those wages..they supported barber shops, restaurants, theaters, clothing stores, furniture stores, they bought houses, paid rent, bought cars.. It all "worked".
Factory owners made money, drove fancy cars, lived in nice homes, sent their kids to the top-notch colleges.. It worked for them too.
I think that a LOT of factory owners operated on "deferred maintenance" and eventually it all started catching up to them. Instead of FIXING what may have been wrong with their "process" or their buildings/labor practices, they took the passive-aggressive route and sold out/off-shored/merged/etc.
Morici: 8/10/10: Trade Deficit Causes Jobless Recoveillegal codemakeRemote('duboard.php?az=html_table')ry
http://www.tradereform.org/2010/08/morici-81010-trade-deficit-causes-jobless-recovery/The following article was written by Peter Morici, a professor at the Smith School of Business, University of Maryland School, and former economist at the U.S. International Trade Commission. Wednesday, analysts expect the Commerce Department to report the deficit on international trade in goods and services was $41.5 billion in June or 3.4 percent of GDP. The trade deficit is a huge drag on economic recovery and jobs creation.
In the second quarter overall, the imports grew so much more rapidly than exports that the growing trade gap subtracted 2.8 percent from growth. But for the increase in the trade gap, GDP would have grown 5.2 percent instead of 2.4 percent. At that pace, unemployment would fall by 2013 to less than 5 percent, the level accomplished the two years prior to the Great Recession
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In the modern theory of comparative advantage taught in graduate schools of economics, the gains from free trade based are premised on approximately balanced trade. Countries increase foreign purchases in industries where they are relatively less productive, and specialize in what they do best. The United States is doing too much buying but not enough selling. Oil and consumer goods from China account for nearly the entire trade deficit, and without a dramatic change in energy and trade policies, the U.S. economy faces unemployment around 10 percent indefinitely. President Obama’s efforts to halt offshore drilling and otherwise curtail conventional energy supplies—premised on false assumptions about the immediate potential of electric cars and alternative energy sources—threaten to make the United States even more dependent on imported oil. Detroit can build many more attractive and efficient gasoline-powered vehicles now, and national policy to accelerate the replacement of the existing fleet would reduce imports, spur growth and create jobs.
To keep Chinese products artificially inexpensive on U.S. store shelves and discourage U.S. exports into China, Beijing undervalues the yuan by 40 percent. It accomplishes this by printing yuan and selling those for dollars to augment the private supply of yuan and private demand for dollars. In 2009, those purchases were about $450 billion or 10 percent of China’s GDP, and about 35 percent of its exports of goods and services.
snip
China recognizes President Obama is not likely to counter Chinese mercantilism with strong, effective actions; hence, it offers token gestures and cultivates political support among U.S. businesses like General Motors profiting from investments in China. President Obama should impose a tax on dollar-yuan conversions in an amount equal to China’s currency market intervention divided by its exports—in 2009 that was about 35 percent. For imports, at least, that would offset Chinese subsidies that harm U.S. businesses and workers.
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