In economics the definition of a third world country is a nation that exports more raw materials, and imports more finished goods. Now we know that this country has an exporting problem, in fact the only major exports we have are financial instruments and finished war materials and raw materials.
The American government has allowed corporations to turn their backs on the American workers since era of Ronald Reagan. In 1979 Reagan campaigned on open borders, free markets and free trade. His vice president George H.W. Bush signed NAFTA, and Bill Clinton signed that treaty into American law. Since the American government cannot impose tariffs on goods to equalize labor costs, corporations are free to leave this country in order to escape the high American standard of living.
Now after 30 years of free markets and free trade, our manufacturing base has been gutted. A country that doesn’t manufacture anything does not create or add wealth to the economy. A service economy, which is essentially what we have today, just moves money around without adding value to a product.
As I pointed out in a previous article, China is now beginning to feel the pressure of outsourcing as factories close and move to even lower wage countries like Philippines and Vietnam.
America used to be the manufacturing capital of the world. Now according to a report by the Port of L.A. our top five imports are,
Furniture- 401,967 TEUs
Footwear- 164,889 TEUs
Toys- 156,227 TEUs
Auto parts- 140,969 TEUs
Apparel- 136,188 TEUs
FYI -TEUs The twenty-foot equivalent unit is an inexact unit of cargo capacity often used to describe the capacity of container ships and container terminals.
Top five Exports are,
Wastepaper- 269,335 TEUs
Cotton- 102,658 TEUs
Grains Product- 98,437 TEUs
Animal Feed- 97,321 TEUs
The conservative ideals have driven the United States from a world manufacturer to a third world country in 30 years. Sure you will hear the regressive conservatives blame our taxes, but they would have to explain China and the outsourcing happening there also. China is where the United States was 30+ years ago, the top manufacturer, until the working class began demanding higher wages and the corporations and the shareholders demanded higher profits, guess who won? It wasn’t the American worker, that’s for sure.