Keeping Our Head Above Water - Why We Need Change & Why It Isn't Coming

In my previous article I outlined a plan to help America become more independent and secure and our government more profitable. Now I am going to discuss why we can't be in competition with China and why we still will be.

According to the General Administration of Customs, last year, Chinese exports to America increased from "25.7 percent to US$1.2 trillion, while imports rose 20.8 percent to US$955.8 billion."* In addition the US has a "$232.5 billion trade deficit"* with China. Their ability to produce cheaper products has caused most companies abandon the US. America, once known for exporting to around the world has been overpowered. Unfortunately, no tax breaks or innovation incentives like Mitt Romney has suggested will be able to equalize the playing field. While these things help, an American would never work for the amount of money that most Chinese factory workers receive. The China Daily reported in 2005 that the minimum wage in Shanghai and Shenzhen, for instance, was $77 and $83 a month**. That's $924 and $996 a year along with the fact that the number of hours worked in that month isn't dictated. In America, it would be illegal to pay a factory worker that much. Regardless of lowered costs, China's workforce is purely more economical than ours.
However, using the plan outlined in my previous article would result in not just gains, but also losses. Many people, for instance, would lose their jobs and that scares the nation, even though more manufacturing jobs would be opened. In addition, most businesses in or partially operating in China and similar countries would be upset at these taxes. Due to this change and the urgings of major companies, it is unlikely the country would ever be able to make this jump to easily. Just remember, be wary of candidate's promises on trade and make sure they explore the possible effects of their ideas.

* Tapei Times; Saturday, January 12 2008, page 10 http://www.taipeitimes.com/News/worldbiz/archives/2008/01/12/2003396840

**China Daily; June 1, 2005; http://www.china.org.cn/english/2005/Jun/130709.htm