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Us Trade Deficit

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Submitted By pretice
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United States Trade Deficit

How many times have you brought something, and you think that it was made in the United States, but when you look at the tag or the product it says made in China, or even Korea? I am sure that everyone can answer many times, and may even wonder if anything is made in the United States. Have you heard so many times that foreign cars are better than American made cars? You many also ask how this happens, so I explain how we get our products in the United States, and how if affects our economy by not actually buying products that are made in the United States.

The United States trades with a lot of different countries, but the biggest competitor would be China. There was a time when Japan was the biggest competitor, but in 2000 China became our biggest competitor. (pg. 734). Trade deficit is when the United States spends more on imports than it sells. The United States imports 60 percent of oil, which raises the trade deficit by over $100 billion a year, which is a lot considering that besides Canada, we are the most energy-dependant in the industrial world, and require about a quarter ton of oil to produce $1,000 of gross domestic product. (pg. 732). One of the factors that contributes to our deficit is the rise of the dollar, what happens is the rise of the dollar depresses our exports, because it makes our goods more expensive compared to foreign goods, which makes imported goods cheaper than the American products so consumers switch to what is cheaper. The only way to reduce this deficit would be if the dollar keeps falling relative to other major currencies. (pg. 32). Manufacturers in the United States claim that China is deliberately undervaluing its currency the Yuan, as much as 40 percent which gives China a big trade advantage when competing with the companies in the United States, which results in factory jobs...

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