The Beginning Of The End
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How Can America Create Wealth If Our Industrial Base Is Destroyed? 50,000 Manufacturing Jobs Have Been Lost Every Month Since 2001

Any economy that constantly consumes far more wealth than it produces is eventually going to be in for a very hard fall.  Many point to relatively stable GDP numbers as evidence that the U.S. economy is doing okay, but the truth is that we have had to borrow increasingly massive amounts of money to keep GDP numbers up at that level.  The U.S. government is going to run an all-time record deficit of about 1.65 trillion dollars this year and average household debt in the United States has now reached a level of 136% of average household income.  But borrowing endless amounts of money and consuming massive amounts of wealth with that borrowed money is a road that leads to economic oblivion.  The only way to have a healthy economy in the long run is to create wealth.  But how can America create wealth if our industrial base is being absolutely destroyed?  According to Forbes, the United States has lost an average of 50,000 manufacturing jobs per month since China joined the World Trade Organization in 2001.  Hundreds of formerly thriving industries in the United States are being totally wiped out.  China uses every trick in the book to win trade battles.  They deeply subsidize their domestic industries, they openly steal technology, they blatantly manipulate currency rates and they allow their citizens to be paid slave labor wages.  So yes, the products coming from China are cheaper, but in the process tens of thousands of factories in the U.S. are shutting down, millions of jobs are being lost and the ability of America to create wealth is being compromised.

In 2010, the U.S. trade deficit was just a whisker under $500 billion.  Much of that trade deficit was with China.

During 2010, we spent $365 billion on goods from China while they only spent $92 billion on goods from us.

Does a 4 to 1 ratio sound like a “fair and balanced” trade relationship to anyone out there?

Our trade deficit with China in 2010 was the largest trade deficit that one country has ever had with another country in the history of the world.

In fact, the U.S. trade deficit with China in 2010 was 27 times larger than it was back in 1990.

Needless to say, that is not a good trend.

Our industrial base and our ability to create wealth is being wiped out so rapidly that it has now become a very serious threat to our national security.

According to Forbes, there is only one steel plant inside the United States that is still capable of producing steel of high enough quality to meet the needs of the U.S. military, and even that plant has been bought by a European company.

Meanwhile, China produced 11 times as much steel as America did last year.

Not only that, China is now the number one supplier of components that are critical to the operation of U.S. defense systems.

How in the world did we let that happen?

So what happens if we have a conflict with China someday?

But of more immediate concern is the loss of jobs that the destruction of our industrial base is causing.

For example, the Ivex Packaging Paper plant in Joliet, Illinois just announced that it is shutting down for good after 97 years in business.  79 good jobs will be lost.  Meanwhile, China has become the number one producer of paper products in the entire world.

But China is not just wiping the floor with us when it comes to things like steel and paper.

The truth is that China has now become the world’s largest exporter of high technology products.  Back in 1998, the United States had 25 percent of the world’s high tech export market and China had just 10 percent. Ten years later, the United States had less than 15 percent and China’s share had soared to 20 percent.

So how is China doing it?  Well, as noted above, they are pulling every trick that they can think of.

Most Americans think that we have “free trade” with nations such as China.  That is a complete and total lie and anyone that believes that we have “free trade” with China does not know what they are talking about.

China subsidizes their domestic industries to such an extreme extent that many global industries no longer even come close to resembling “free markets” as a recent story in Forbes noted….

According to a story in the January 20, 2009 New York Times, government subsidies so thoroughly disrupted pricing in the global market for antibiotics that many western producers had to either move facilities to Asia or exit the business entirely. The reason this might matter to intelligence analysts is that the last U.S. source of key ingredients for antibiotics — a Bristol-Myers Squibb plant in East Syracuse, New York — has now closed, leaving the U.S. dependent on foreign sources in a future conflict.

Our politicians and our business leaders have pursued economic policies that are so self-destructive that it defies explanation.

How in the world could anyone be so stupid?

Since 2001, over 42,000 U.S. factories have closed down for good.  Millions of jobs have been lost.  The ability of the once great American economic machine to create wealth has been neutered.

The business environment in America is completely and totally pathetic at this point.  The number of small businesses that are being created is also way, way down.

According to the U.S. Census Bureau, only 403,765 small businesses were created in the 12 months that ended in March 2009.  That was down 17.3% from the previous year, and it was the smallest number of small businesses created since records began being kept in 1977.

The truth is that the U.S. economy is dying.

We continue to consume about the same amount of wealth that we always have, but our net worth is declining.

According to the Federal Reserve, more than two-thirds of Americans have seen their net worth decline during this economic downturn.  In fact, the Fed says that between 2007 and 2009, the wealth of the average American family declined by 23%.

So if it seems like your family and everyone around you is getting poorer, that is because it really is happening.

We really are becoming poorer as a nation.

We can see evidence of this all around us.  Just consider a few of the examples that have been in the news in recent days….

*One school district in the Chicago area is laying off 363 teachers.

*The U.S. Postal Service is offering $20,000 buyouts to thousands of workers as they attempt to slash 7,500 good paying jobs.

*The city of Detroit, once a shining example of middle class America, is now a rotting cesspool of economic decline and it saw its population decline by 25 percent over the decade that recently ended.

Americans are not feeling the full impact of America’s industrial decline yet because we have been filling the gap in wealth creation with massive amounts of debt.

In the years since 1975, the United States had run a total trade deficit of 7.5 trillion dollars with the rest of the world.  That 7.5 trillion dollars could have gone to support U.S. businesses and U.S. workers, but instead it left the country and went into the hands of foreigners that do not pay taxes.

Therefore, the U.S. government, state governments and our local governments have had to borrow massive amounts of money to make up the difference.

Most people do not realize it, but the destruction of America’s industrial base has played a very significant role in the government debt crisis we are facing today.

In addition, the millions upon millions of workers that have lost their jobs as America’s industrial base has been destroyed are now a drain on the system.  Instead of creating wealth and being involved in economically productive activity, millions of American workers are now totally dependent on the U.S. government for survival.

Do you think that it is just some sort of accident that we have 44 million Americans on food stamps?

Don’t you think that a large percentage of those people would actually like to have good jobs that would enable them to sufficiently feed their families?

If we continue on the path that we are currently on we are not going to have much of an economy left.

Not that all trade is bad.  Certainly not.  For example, trade with Canada is generally a very good thing.

However, the horribly unbalanced and unfair trade relationships that we have with nations such as China are ripping our industrial base apart.  Our politicians have not been telling us the truth about what the “global economy” will mean for American workers.  Most U.S. workers never realized that globalism would mean that they would be competing for jobs with workers willing to work for one-tenth the pay on the other side of the globe.

Those people that believe that we can indefinitely maintain an economy where we consume far more wealth than we create are completely and totally delusional.

Until the American people wake up and start demanding change from our politicians on these issues, 50,000 (or more) manufacturing jobs will continue to fly out the doors every single month and even more Americans will become dependent on government welfare.

Is that what you want?

  • Tom Ubl
  • Pingback: 35 Facts About The Gutting Of America’s Industrial Might That Should Make You Very Angry | Hawai`i News Daily()

  • H. Brian Rector

    We have the solution to our problems. Primarily, we need to adhere to our US Constitution, i.e. we must revoke the FED’s ability to coin, print issue and value the US $. It is an exercise in stupidity to pay interest on money which the country can issue backed by its own resources and the ingenuity and abilities of its citizens. We can step in and assume control of the banking system and simply “eliminate” the interest being paid to the secret, private owners of the FED. Current trade deficits and foreign aid debts can be used to offset debts owed on Treasury notes held by foreign countries. All lobbying at the state & federal level should be outlawed and the resulting local lobbies can be investigated and regulated by law enforcement and the courts with an eye on sedition, blackmail and organized crime through RICO.

    The FBI and FEMA must be charged with the responsibility of locating ALL foreigners in the US who are not citizens, have no VISA and have no business being here. The US military should be deployed, shoulder to shoulder, at our national boundaries to halt illegal entry into the US. These situations are UNLAWFUL, there is no debate. The laws are in effect and they are being broken, and, ALL offenders must be apprehended and prosecuted.

    A major portion of the current defense budget must be redirected to healthcare, education and research & development of alternative energy industries to replace our dependence on petroleum.

    Above all, there will be no more SECRETS kept from the people, the national security will be in the hands of the elected officials controlling the military branches and subject to the oversight of the Executive Branch, who, is ultimately answerable to the Supreme Court.

    Any corporations who repeatedly violate laws and regulations will be stripped of their right to employ people, the shareholders will have direct recourse to those managers & directors guilty of offenses and the organization will be reorganized under government supervision or dissolved.

    The law schools in our major universities will be saddled with the task of trimming ALL statutes and Executive Orders which smack of unconstitutionality. There recommendations will be reviewed by the Supreme Court and dealt with expediently.

    We must change the paradigm that we are a country where people from other countries can come here and desert their homeland and their responsibility to their fellow citizens. Those who come here to learn our freedoms and successes MUST take them back to their homelands to improve and enrich the rest of the world. We must not be an escape route, but a taskmaster for wealth and prosperity. Foreign aid can then be used build partnerships instead of potential terrorists and murderers like Hussein, ben Laden, Mobutu and the rest the CIA has paid off over the years to undermine democracy.

    This government, controlled by banks and corporate entities is responsible for our current situation. It is clearly a failure. It cannot function under the Constitution because it is controlled by a monetary usurper of the public’s right to govern itself. The only entity that has enough money to achieve this……….is the entity that issues the money. Think about it…….when the government needs money it BORROWS it from the FED………what keeps them from creating it when “we are not looking”? Where is the audit?

    This same group that we “bailed out” should be arrested and prosecuted…..even the people are marching on Wall Street!

    • Andrea Renee Hall

      Corporations in American give up on the workforce in this country because it’s cheaper to do dirty business in other countries with Cheap labor. They can pollute their water ways and not have to pay for it. NAFTA opened that door, and all that was corrupt stayed that way. Now The only thing left is dirty Energy. The Koch Bros. have won contracts and have launched one of the worst assaults on Mother Nature, and gas won’t be cheaper at the pump, it will not create jobs for it’s people, either. You can thank your state elected officials for not standing up for the 98%… FBI.FEMA aren’t real. They don’t even come close to the hell we will all pay in the end..

  • Pingback: 40 Hard Questions That The American People Should Be Asking Right Now « Eclectic Thoughts()

  • Pingback: The Truth is out there – But do you want to know? | Sovereign Independent()

  • Pingback: 40 Hard Questions That The American People Should Be Asking Right Now | Hawai`i News Daily()

  • Steve

    Buy an American product. With money you have, not a credit card.
    If you keep buying crap that breaks, its your own fault!

  • Sum Ting Wong

    Puny Amelicans!
    Bow down to the ilon dlagon! This centuly is ouls fol the taking!
    Who has the tiny pelis now, eh?

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