It's a "We" Problem, Not a "Them" Problem


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The U.S. currently runs a negative trade balance with the world. This means we are a net importer. Our trade relationship with China has been a serious problem for moldmakers and many other industrial sectors. The other glaring trade issue is the amount of foreign oil imported into the U.S. As a country, we are addicted to both cheap Chinese-made goods and oil. These addictions are bad for our economy, but more importantly, they are bad for our national security. An addiction is another way of saying “uncontrolled demand.” These addictions were the result of uncontrolled aggregate demand. There are many ways in which our addictions are expressed, so there are many things we could choose to do to correct them. Not engaging in foreign trade is not one of the things we should choose. What we should do is learn to limit our consumption of the products to which we are addicted. Energy independence will not be achieved by digging more wells or by building more pipelines, though these activities might be marginally helpful. What we need to do is demand products that promote energy efficiency and the development of alternative energy products. We do not have a production problem, we have a consumption problem. Our trade problems with China are not the fault of the Chinese. They are a WE problem, not a “them” problem. Our economy can benefit greatly from globalization and expanded trade agreements. But we must first take care of business at home by making better use of the power of our aggregate demand.