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THE CONSERVATIVE REVIEW - March 16, 2010
The Disemboweling of America
by Pat Buchanan
Though Bush 41 and Bush 43 often disagreed, one issue
did unite them both with Bill Clinton: protectionism.
Globalists all, they rejected any federal measure to
protect America's industrial base, economic independence
or the wages of U.S. workers.
Together they rammed through NAFTA, brought America under
the World Trade Organization, abolished tariffs and granted
Chinese-made goods unrestricted access to the immense U.S.
market.
Charles McMillion of MBG Information Services has compiled,
in 44 pages of charts and graphs, the results of two
decades of this Bush-Clinton experiment in globalization.
His compilation might be titled, "Indices of the Industrial
Decline and Fall of the United States."
From 2000 to 2009, industrial production declined here for
the first time since the 1930s. Gross domestic product
also fell, and we actually lost jobs.
In traded goods alone, we ran up $6.2 trillion in deficits
-- $3.8 trillion of that in manufactured goods.
Things that we once made in America -- indeed, we made
everything -- we now buy from abroad with money that we
borrow from abroad.
Over this Lost Decade, 5.8 million manufacturing jobs,
one of every three we had in Y2K, disappeared. That
unprecedented job loss was partly made up by adding
1.9 million government workers.
The last decade was the first in history where government
employed more workers than manufacturing, a stunning
development to those of us who remember an America where
nearly one-third of the U.S. labor force was producing
almost all of our goods and much of the world's, as well.
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Not to worry, we hear, the foreign products we buy are toys
and low-tech goods. We keep the high-tech jobs here in the
U.S.A.
Sorry. U.S. trade surpluses in advanced technology products
ended in Bush's first term. The last three years we have
run annual trade deficits in ATP of nearly $70 billion
with China alone.
About our dependency on Mideast oil we hear endless wailing.
Yet most of our imported oil comes from Canada, Mexico,
Venezuela, Nigeria and Angola. And for every dollar we
send abroad for oil or gas, we send $4.20 abroad for
manufactured goods. Why is a dependency on the Persian
Gulf for a fraction of the oil we consume more of a danger
than a huge growing dependency on China for the necessities
of our national life?
How great is that dependency?
China accounts for 83 percent of the U.S. global trade
deficit in manufactures and 84 percent of our global trade
deficit in electronics and machinery.
Over the last decade, our total trade deficit with China
in manufactured goods was $1.75 trillion, which explains
why China, its cash reserves approaching $3 trillion,
holds the mortgage on America.
This week came a report that Detroit, forge and furnace of
the Arsenal of Democracy in World War II, is considering
razing a fourth of the city and turning it into farm and
pastureland. Did the $1.2 trillion trade deficit we ran
in autos and parts last decade help kill Detroit?
And if our purpose with NAFTA was to assist our neighbor
Mexico, consider. Textile and apparel imports from China
are now five times the dollar value of those imports from
Mexico and Canada combined.
As exports are added to a nation's GDP, and a trade deficit
subtracted, the U.S. trade deficits that have averaged $500
billion to $600 billion a year for 10 years represent the
single greatest factor pulling the United States down and
raising China up into a rival for world power.
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Yet, what is as astonishing as these indices of American
decline is the indifference, the insouciance of our
political class. Do they care?
How can one explain it?
Ignorance of history is surely one explanation. How many
know that every modern nation that rose to world power
did so by sheltering and nurturing its manufacturing
and industrial base -- from Britain under the Acts of
Navigation to 1850, to protectionist America from the
Civil War to the Roaring Twenties, to Bismarck's Germany
before World War I, to Stalin's Russia, to postwar Japan,
to China today?
No nation rose to world power on free trade. From Britain
after 1860 to America after 1960, free trade has been the
policy of powers that put consumption before production
and today before tomorrow.
Nations rise on economic nationalism; they descend on free
trade.
Ideology is another explanation. Even a (Milton)
Friedmanite free-trader should be able to see the disaster
all around us and ask: What benefit does America receive
from these mountains of imported goods to justify the
terrible damage done to our country and countrymen?
Can they not see the correlation between the trade deficits
and relative decline?
Republicans seem certain to benefit from the nation's
economic crisis this November. But is there any evidence
they have learned anything about economics from the
disastrous Bush decade?
Do they have any ideas for a wholesale restructuring of
U.S. trade and tax policy, for a course correction to
prevent America's continuing decline?
Has anyone seen any evidence of it?
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