Reply #13: The problem is the offshoring of jobs and excess government debt due to the Iraq war. [View All]

The wealth of a country is based on manufacturing. This is why Japan, South Korea, and Taiwan have a high standard of living even though they have few natural resources. They import materials and manufacture more goods than they need within the country. Therefore they sell those goods abroad earning cash or credit with which to import goods from other countries.

At one time, the US was a creditor nation that manufactured more goods than it needed internally, and sold those goods abroad. This wonderful situation turned sour when corporations decided to send manufacturing overseas to cheap labor countries. It increased corporate profits, but the US became a debtor nation with effectively high unemployment. The REAL unemployment in the US is much higher than the meaningless unemployment figures given out by the government.

Another reason for the current economic crisis is due to the high oil prices and excessive demand for oil in the US. American auto companies, in collusion with their buddies and fellow investors in Big Oil, have insisted on producing gas guzzlers long after the technology has allowed for the development of vehicles with much better gas mileage. In the 1970's, after the so-called Arab oil embargo (which the American oil companies enabled), the government mandated corporate average fuel efficiency standards (CAFE) which spurred the auto companies to introduce technology that increased gasoline mileage. This fuel efficiency reduced oil consumption, reduced oil imports significantly, and stabilized oil prices for several years.

At the same time, manufacturing was shipped overseas creating a huge trade deficit, the Bush government dropped taxes for the rich and started the Iraq war/occupation on borrowed money. This debt is financed by borrowing money at high interest rates from the only people who have any, the rich people. And they get to keep all the profits since they already have had their taxes lowered. What a system, hey.

So what is the solution? Actually quite simple. Forget about tax cuts and forget about juggling the interest rates. It is too late for any of that stuff to work. That is putting a band aid on a gaping wound. We need some serious suturing here.

First, we need to act to bring manufacturing and jobs back to America. If the goods that we buy are manufactured here, then the money spent on them will stay in the US and allow us to get out of debt. No waiting for this new technology baloney to take hold. Get rid of NAFTA, the WTO, the IMF, the World Bank, and all of the other trade groups that make us dependent on the multinational corporations.

These agreements and trade groups are designed to stifle competition from small businesses who would hire and employ Americans. Bring back jobs in clothing manufacturing, shoe manufacturing, furniture manufacturing, electronics manufacturing, toy manufacturing, tools, appliances, and on and on.

This will have several effects, all good for Americans. One, it will provide jobs for Americans. Two, it will reduce foreign debt and increase the value of the dollar. Three, it will NOT increase costs to consumers for two reasons: One is that the lower labor costs have NOT been passed to the consumer as lower prices, but have been retained as extra profits by the corporations. Two, the reduced foreign debt will stabilize the value of the dollar. Four, newer businesses that will finally be able to compete with the multinational corporations and will help keep prices from rising.

Working Americans will pay income taxes reducing the need for the government to borrow money which will help reduce the national debt.

Some other policies that will help. Get rid of ethanol made from corn. It doesn't save oil since gas mileage suffers. Turning corn into ethanol reduces corn supply for food which causes a rise in food prices like for milk and other dairy products. It is only used because it increases profits for agribusiness corporations without reducing oil consumption or oil company profits.

Stop wasting money on developing hydrogen fuel for autos. That still provides complete control over energy usage in the US to the oil companies, and will not save any money for consumers. The way to go is pluggable and/or hybrid electric vehicles. The reasons are many why this is the fastest and least expensive way to rid ourselves of dependence on foreign oil. The technology already exists and overall costs are the least for the consumer.

Develop universal health care programs NOT tied to employment. This will allow smaller companies to compete by taking away a cost burden to them, and allow smaller companies to compete for the best workers, since labor will be able to seek better jobs if they don't have to depend on any given employer for health insurance.