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US Exports Fall; Obama Goal Doomed

Today’s trade figures are the worst of all possible worlds.  The US trade deficit widened to $53.1 billion in June — much higher than forecast.  That’s bad enough news when world markets are still reeling from the credit downgrade.  But there’s more.  Imports actually shrank in June — a sign that the US domestic economy is weak.  The trade deficit still grew, however, because US exports fell faster and farther than expected.

The White House doesn’t talk about this much now, but in a moment of weakness President Obama pledged to double American exports in five years.  It’s an unusually lame promise, even from a politician; nobody has any idea how to do this under normal conditions, and with the world economy suffering one hit after another, the goal is dead.

The President should have gone to pundit school, where they teach you that “It’s always good to give a date.  It’s always good to give a number.  But it’s never good to give a date and a number.”

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  • Kris

    “nobody has any idea how to do this under normal conditions”

    Ah, but POTUS gets to shape conditions. The goal can be achieved through a two-pronged plan:

    1. Hobble the American economy, increase the debt, and run the currency printing presses 24/7. This leads to a weakening of the dollar and thus to increased exports.

    2. Increase global instability through a feckless foreign policy. At a minimum, this should lead to foreign armament, and an increase in American weapons exports. At best, this could lead to large-scale wars which will negatively impact the export capacities of our trade competitors.

    I’ll admit that this kind of plan is difficult to implement within five years, but I have the utmost faith in President Obama.

  • Luke Lea

    Introduce tariffs on imports from low-wage countries overseas and exports will surge — along with American wages. And manufacturing employment — did I mention manufacturing employment? When we import less we manufacture more for the home market.

    By the way, in case it’s not clear, the reason exports can be expected to surge is that countries like China, realizing they an no longer follow an export-led growth strategy, will choose instead to cash in their chips (dollars) to purchase machine tools and other industrial equipment made in the U.S. which China will need to produce more goods and services for their home market.

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