Fortunately, American consumers are in a position to make this better vision a reality . . .
Some people are looking to the government to solve this problem. It’s not working. We have watched as members of both political parties and leaders of iconic American companies have sent manufacturing, and now service and professional jobs, offshore in pursuit of the mirage of “free trade”, resulting in a “race to the bottom” that continues unabated.
But we have good news. We, as consumers, can solve this problem ourselves. All we have to do is choose to purchase quality products made in America, with money we are already spending, creating jobs in the communities where they are made.
By bringing this spending home, we can be the "intervening cause" that breaks the downward cycle of the vicious circle, and ushers in the virtuous circle:
The fact is, consumer spending makes up nearly 70 percent of the $17.5 trillion U.S. economy. With this much spending power, American consumers are in a strong position to affect how things go, simply by redirecting spending to the purchase of products made in communities across America. [The imbalance in trade in goods can also be reversed by increasing exports of U.S. products. MIAA is working with American manufacturers to do that, by facilitating foreign consumers’ purchases of American products via our marketing channels.]
In "Where did the jobs go?" we describe the $700 billion-plus trade in goods deficit -- imports into the American economy in excess of American exports to other countries' economies. Of that $700 billion, we have identified some $500 billion that is subject to consumer discretion -- choices we make every day, in the following categories:
$500 billion would create a lot of jobs. How many? According to a study published in February 2014, 5.8 million – 2.3 million of them in manufacturing.[i] Looking at the effects of a $500 billion shift in the balance of trade, the authors of that study concluded that total economic production (GDP) would rise by $720 billion in the third year. [Id.]
[i]Robert E. Scott, “Stop Currency Manipulation and Create Millions of Jobs – With Gains across States and Congressional Districts,” EPI Briefing Paper #372. (February 26, 2014)
But let us emphasize, we are not against trade. America needs to export, and needs vibrant trading relationships with other countries. But, those relationships need to be balanced – imports from a country must be balanced by an equal amount of exports from the U.S. Fair trade is balanced trade.
Some have suggested that America has a charitable duty to support those jobs overseas. At MIAA, we believe there is a moral as well an economic imperative for America to lift poorer countries toward a higher standard of living. However, that cannot be done by the wholesale transfer to those countries of the production of products destined for the U.S. market.
If we want to help other countries climb out of poverty, we need to do it in a more thoughtful way – in a way that is not causing poverty in the U.S. A country that does not produce cannot be strong, and a strong America can best help the less fortunate.
$500 billion in spending and 5.8 million jobs is a lofty, worthy goal, but what can one person do?
GO TO What Can I Do?
May 15, 2014, Ontario, CA - MIAA's founder, Jim Stuber, delivered the keynote address at the 20th annual World Trade Conference sponsored by the U.S. Department of Commerce and the California Inland Empire District Export Council in Ontario, California. To view the conference agenda, click here:
May 7, 2015, Radnor, PA. MIAA's founder, Jim Stuber, appeared as the guest of host Richard J. Anthony, Sr. on The Entrepreneur's Network TV at Radnor Studio 21. The program featured a discussion of the problems caused by offshoring manufacturing and white collar jobs and how consmers can solve the problem with their spending decisions.
Studio 21 has made the program available for viewing here: