Broken Record: A Look at the Consequences of Failed U.S. Policies

The new numbers are in, and they are worse than ever. In the month of February, the United States hit another record trade deficit, this one topping $61 billion. Economists don’t believe that this number will fall anytime soon, as backward policies continue to reign over the present Administration. The results of the trade deficits are clear- a near worthless U.S. dollar, coupled with massive inflation here at home. Wages are also negatively impacted, as not only does unemployment rise during periods of increasing trade deficits, but since the overall value of the dollar is decreasing, a person whose wages have remained constant over the past year will find the purchasing power of their salary to be increasingly less. Thus, not only does a higher trade deficit cost people their jobs, those who do have jobs are suffering from pay cuts, as well as a drop in the purchasing power of the dollar.

The causes of the trade deficit are clear. Oil prices are continuing to rise, with no end in sight. As the Bush Administration continues to buddy up to the oil cartels and royal families of Middle Eastern oil-rich nations, the average American is paying about $2.25 a gallon. While the Administration seems intent on not disturbing their relationship with their “allies” in Saudi Arabia- the same nation that claimed as its citizens 15 of the 19 hijackers who perpetrated the 9/11 attacks, Americans are suffering from rising gas costs and a higher trade deficit each month.

Another major cause of the trade deficit is the free trade policies that have ruled American trade policy over the last 20 years. President Clinton thought that it would be wise to create NAFTA (the North American Free Trade Agreement). Unfortunately, NAFTA has hurt American business owners by promoting foreign goods to consumers that are cheaper than American products. The fact that there is no buffer to protect against this (tariffs, import taxes, e.t.c, that might create equity in the trade markets around America and the world), American companies are suffering from lower earnings as a result of free trade. Indirectly, free trade has hurt American workers as well, by putting companies in a position where they must fire workers to keep up in an ever-competitive global market.

Unfortunately, the present Administration has done nothing to retract the dangerous free trade policies of the United States. In fact, the Bush Administration is trying to pass CAFTA, the Central American Free Trade Agreement. This trade agreement would widen the area of free trade in this hemisphere, and create an even more perilous situation for American companies, casting a shadow over their dubious futures.

There is an even greater threat to the future stability of American commerce, and that is the fact that the United States is currently in a situation where they cannot increase tariffs for goods being brought in by foreign countries- particularly China and Japan. The reason for this is because a major tax cut to the wealthy, coupled with a war of aggression, has bankrupted the United States treasury. Today, we have another record broken by the Bush Administration. That is a record deficit in the amount of more than 8 trillion dollars. When America is in a situation of a deficit, the way they are able to maintain stability and keep on running the day-to-day operations of government is by selling their debt in the form of treasuries. We have trillions in outstanding treasuries that are owned by China and Japan. If we were to even hint at the possibility of increasing tariffs, those two nations alone could cash in those debts, causing America to collapse financially, and create the worst economic depression in the history of the world. So, while the United States continues to rack up more and more debt by following increasingly dangerous policies, the foreign nations holding our debt will grow stronger and stronger, and can cause America to collapse into a third world country.

While poor policies, and even more specifically, foolish trade policies, continue to plague the U.S. financial markets, American companies and consumers are feeling the heat more and more as each day passes. With a higher unemployment rate, and a lower valued dollar, the Bush Administration is no longer in a situation where they can afford to act like leaders of the most powerful nation in the world. The continuation of their destructive policies will only lead to the devastation of our economic standing in the world.

Americans are sick and tired of turning on their television sets at night and hearing about another new record: record deficits, record debts, record war deaths, e.t.c. To us, news of this country’s ruin day after day is sounding like a different kind of broken record.