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Trade Deficit record will be broken next month
by Mike Crane

The November 2006 Trade statistics were released on January 10 and for the third month in a row, the trade deficit showed a slight decrease. This is of course better than an increase. But the current Administration crowing about the great progress they are making is a bit premature. For example in 2003 there was a somewhat similar decrease from previous highs for seven months in a row, and yet 2003 still set an all time record dismal trade deficit.

Even the slight improvement the last three months will have to increase greatly to prevent 2006 from once again, sinking to the worst trade deficit in our history. The trade deficit would have to be lowered to just $19,000,000,000 for December. We have not had a trade deficit that low in many years. So watch the trade deficit numbers around the middle of February to see if the last three months are the beginning of a new trend or just a blip on the radar screen.

The first eleven months of 2006 show a 6.9% decline over 2005. The first eleven months of 2006 are more than double the first eleven months of 2001! They are close to double the first eleven months of 2002 and are $46,000,000,000 worse than the first eleven months of 2005.

Using simple projection arithmetic this points toward a 2006 Trade Deficit of $771,000,000,000.00 (2006 monthly average of $64,900,000,000 for the last  month of 2006).

This remains a track record of failure!

This remains a track record of selling your grandchildren's future! Even the lowered trade deficit of $58,000,000,000.00 equates to $194.00 of debt for every man, woman, child and terminated unborn baby in this country for the month of November. That is $2,328.00 of debt for every man, woman, child and terminated unborn baby in this country.

If you are a gainfully employed adult today - it is easy to look at these dismal numbers and just say - "So What?" And that is what a majority of Americans obviously do - and of course have a right to do.

But will your grandchildren have the same option?

Even with the improvements we are marching down the path of globalization - month by month! Have you given any thought what that means to your future, your children's future and most especially your grandchildren's future? If not I hope and pray that you will begin to.

I have and I am very concerned about the future of my grandchildren!

President Bush with support from both the Republicans and Democrats is destroying Our Founding Principles as fast or faster than any President in our history. He is pushing "globalization!" He tells us this is good for us!

How in the world can it be good for us to run an ever increasing deficit that everyone knows can not continue? In the long run someone will have to pay the piper - and that someone is probably going to be your children or grandchildren!

What is Globalization?

Lets look at what his idea of globalization means to you, your children and grandchildren. The following is in approximate numbers and only looks at the impact of a true global economy between our country and India. The impact is of course greater when you factor in the entire world.

Globalization: The Politicians pitch: Free Market forces will eventually solve the problem. Rising incomes in foreign countries will stabilize the situation.

Explanation:  Using some round representative numbers (references at bottom):

US population 300 Million, Average per capita income - $33,000 per year

India population 1 Billion, average per capita income - $472.00 per year.

Equalized income between US and India - $7,978.00 per year.

What that means to you: Average American income will fall dramatically.

If we achieve globalization - if the current economic policies are maintained the American average per capita income will have to fall to $7,978.00 per year - for the per capita income in India and the US to equalize.

Effect on your grandchildren: You are condemning your future generations to live on the equivalent of roughly $8,000.00 current dollars.

Ladies & Gentlemen, this is what we are leaving our children and grandchildren if globalization continues unabated.

Except it is actually worse than the above example indicates. That example only considers the population of India, globalization carried out would include not 1 Billion people as in the example, but would include somewhere around 5 Billion.

Is this what you voted for? Well it is what you are getting and it is brought to you by both the Republican and Democratic Parties leadership!

The Trade Deficit is just one piece of a complicated picture and our elected officials depend on the picture being so complicated that the citizens of our country will not realize what globalization really means. You do not hear this from either of the major parties because they are addicted to the contributions of the proponents of globalization know as campaign contributions.

What a corporate dream, everybody working for poverty wages - except the elite few! What a dismal future for your future generations.

Warren Buffett - hardly a Southern Party member - has come to the same conclusion:

Instead of moving toward an "ownership society," Buffett suggested, with admitted hyperbole, that the economic burden ahead is more likely to result in a "sharecropper's society" dependent on foreign landlords.

Think about that as you read the rest of this article.

Lets look at the government's own chart (US Commerce Department) for recent years. This is not a chart of success - it is a chart showing the results of failed policies for the last few years. Many do not realize that citizens of my age (I am 58) grew up in a time when our county was the world's leading creditor nation. Youngsters today are growing up in a time when our country is the world's greatest debtor nation and has been their entire life.

All of you know that debt can not increase at these rates forever!

Somebody will have to pay the price for this fiscal irresponsibility!

Will it be us, the adults whose watch this is occurring on - or will it be your  children - or will it be your grandchildren? I hope you will give that some thought, if you do - you will know what the right thing to do is.

Taking a longer term look shows the effect of the current failed policies more dramatically:

The direction and trend is more than obvious:

Down, down!

Might as well install screen doors on a submarine and take 'er out for a test dive.

These are just facts, the government's own reports and are not our numbers.

But your elected officials continue to tell you that this is "good for you!" President Bush claims that anyone opposed to the selling of your grandchildren's future is guilty of being an isolationist. By his definition ALL of Our Founding Fathers were isolationists!

Well folks, he is in effect calling Our Founding Fathers and all Administrations up until the last few decades isolationists! I would much rather be grouped in with the likes of Thomas Jefferson than Bush and Clinton!

Still not convinced?

Lets look at the government's own numbers of the selling of our country. In the terms of the new age rocket scientists called economists this is called foreign investment. Foreign entities (countries, corporations and individuals) buy US assets with the dollars received from the trade imbalance.

Never before in the history of our country has foreign investment - fueled by our own trade deficits - reached such levels!

Month by month, the failed economic policies continue to produce record setting trade deficits and record setting transfer of ownership of assets in our country to foreign owners!

Yet, your elected officials do nothing to reverse this trend. They will now admit that it can not continue forever, but they do nothing to take even the first step toward reversing the trend!

Until changes are made, until these failed economic policies are changed the downward trend will only continue!

Continued Decline

Factories, call centers, development centers, financial centers and whole industries are moving to foreign countries and will continue to do so until these failed economic policies are changed.

Empty factories and other facilities do not produce goods to be purchased or exported, even if President Bush, Congress, Republicans and Democrats tell us this is good for us, empty factories just do not produce much!

When Americans need the products and services those factories and facilities used to produce - they have to buy imports. As long as more factories move to foreign countries than move to our country, we will export less and import more! The chart on the right shows the long term trend of lost factories as a percentage of the working population in our country. These are jobs moved to foreign countries, so that we lose both the income and have to buy imports.

Meanwhile the Bush Economic Polices (and previous President Clinton's) continue their march into our country's history.

If all of our remaining facilities ran at 100% capacity this year and exported every bit of additional product - we would still have a trade deficit! But instead of polices to increase utilization and capacity of our facilities we have government polices in place which encourages their relocation to foreign countries!

Until the failed policies are changed - there is nothing to stop the downward trend!

Lets repeat that statement, it is very important:

Until the failed policies are changed - there is nothing to stop the downward trend!

The mushrooming Trade Deficit and Budget Deficits are creating over $1,000,000,000,000,000.00 - 1 Trillion Dollars of debt per year! That is over $3,300.00 of new debt for every man, woman and child in our country - per year! There are very few options on eliminating debt:

1) Repudiate it - At a national level  - would mean the US default on all securities and collapse of our economy. At the corporate level means closing the doors and layoffs and reductions in salaries and benefits for those remaining on payroll. We are seeing the corporate level effects already.

2) Devalue the dollar - The long term trend is a devaluation of the dollar. This means - lowering of American income in relation of the rest of the world and higher import prices. The dollar is declining against major currencies. The Bush Administration is demanding that China let the dollar "decline" against their currency.

3) Inflation - Means you get less value for your dollar so it is in effect worth less.

4) Raise Taxes - Tax rates are rising if you include all of the hidden and embedded fees, costs, regulations and inflation.

5) Liquidate assets - This is in effect selling American assets to foreign entities and is the major source of funding for our current debt. Should this be our national policy? The list of foreign owned - former American companies - is staggering and growing. Even government entities are now selling facilities to foreign operations, for example toll roads.

With the exception of national repudiation of debt, the other forces above are all in play now, and are the mechanisms that will lower American per capita income to match the rest of the world. You are seeing the small steps in the march to globalization on an ongoing month by month basis.

Step by step you are marching toward globalization. Step by step - your grandchildren's future is being sold on the auction block of special interest influence. Before "political correctness" it would have been called by its real names - "corruption" and "fiscal irresponsibly."

It is up to you - the American citizen to decide how long - you - are going to let it continue. The most recent 109th Session of Congress passed three more Expensive Trade Agreements - CAFTA, Oman and Bahrain. More are in the works.

The Southern Party has released a position statement that would change the failed and misnamed "free trade" to one of FAIR Trade (See: A Southern Party of Georgia Position on solving our country’s Trade Deficit).

What you can do.

If you are concerned about these economic policies, at some point you need to ask yourself the question, "what am I going to do about it?" Go back and look at either the chart at the top or the Department of Commerce graph. There can be very little question what the trend is and what you can expect if something is not changed.

Are you concerned enough to consider some things that you can very easily do to begin raising awareness of the future problems? If so please consider:

1) We need your help in passing this information on to others. How many people do you know that would be concerned or interested? If everybody that reads this page - that does care - finds one new person a month, in two years we could retire every US House Representative or US Senator up for election across the country that is selling your grandchildren's future. That is a lot of results for very little effort. Last month the list receiving these updates only grew by just over 125, perhaps too many were relying on the other person to find their new person or only 9% are concerned.

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2) Take a few minutes and read the Southern Party of Georgia position on FAIR Trade as opposed to our government's policy of Expensive Trade. If you do not understand the position or want to discuss contact the author of this article, mikecrane@tds.net . If you support such a policy, ask your Congressional Representative and US Senators if they will support it. If they say no, throw the bums out of office next election and get someone who will.

(See: A Southern Party of Georgia Position on solving our country’s Trade Deficit).

3) Consider joining the Southern Party of Georgia or one of the Southern Parties springing up in other States (Southern Party of North Carolina and Southern Party of Mississippi) and helping our efforts to expose the dangers of creeping globalism.

Southern Party of Georgia
725 Ridgeview Road
Morganton, Georgia 30560

Credit card contributions can be made at 877-903-0996.

Paypal contributions: chairman@spofga.org

Georgia Campaign Finance Reporting requires we ask for your name, address, occupation and employer.

These are simple steps, require very little effort and even the financial request is not a burden. When Republicans and Democrats call you (they can afford telemarketing, many cases using call centers in India) they ask for much more. We need your help more than they do and when you help Republicans and Democrats you get creeping globalism thrown in for free.

“Nobody made a greater mistake than he who did nothing
because he could only do a little.”
― Edmund Burke (1729 - 1797)

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References for per capita income:

US per capita income (2004): Reference  http://www.vtlmi.info/pcivt.htm

India per capita income (2004) is 20,989 Rupee (see: http://timesofindia.indiatimes.com/articleshow/1009693.cms). Using the Dollar <-> Rupee currency conversion rate of March 10, 2006 (.02249), this is $472.00 per year per year.

Methodology - Multiply population estimates by per capita income for both countries, add the total income and divide by combined population.

US - 300,000,000 people x $33,000.00 = $9,900,000,000,000
India - 1,000,000,000 people x $472.00 = $472,000,000,000
Total = $10,372,000,000,000 divided by 1,300,000,000 people
Result = $7,978.46

About the author:

Mike Crane is the 2nd vice chairman of the Southern Party of Georgia and a candidate for the 51st Senate District in Georgia. Despite gathering over 7,000 petition signatures in 2004 and 2006 combined was denied ballot access both elections.  While 70% of the Georgia State House districts and 56% of Georgia Senate districts had one candidate in November, Georgia tax dollars are used to prevent political competition. The time has come to end Banana Republican style elections in Georgia!