Ticking Time Bomb? US-China Trade Deficit Keeps Growing

OUR HEADS ARE IN THE SAND

Sorry folks, this is not going to be a nice read. But it's not my fault.

Well... yes it is my fault! And your fault, too!

Yes, we are very busy. As a nation, we are certainly engaged in a war on terrorism. That our leaders are doing something about this is indisputable. That we as taxpayers have to pay for the bill is indisputable, too. We go to work every day and pay those taxes...

We also have very real personal responsibilities to answer for - like raising our children, and helping each other out in times of need. Yes, on a national level and a very personal level, we are certainly busy.

So why am I going to remind us of another responsibility? Because it has to do with you and your family. If not now, then soon...

CAUGHT WITH OUR PANTS DOWN

Recent fashion has it that kids go walking down the street with their trousers down. Well, we upright adults aren't all that different from them with respect to another issue. We've really let our pants drop on this, and I promise you: If no-one does something about this soon, we will be smacked squarely in the fanny - or worse. So, let's not mince words...

- In 2006 the US-China trade deficit has grown to more than $430 BILLION!!!

- Next year's deficit prediction is $730 BILLION!!!

This said, the US and China hold the world's largest unresolved trade debt relationship.

WHAT IS A TRADE DEFICIT?

It's like we've racked up a 430 billion dollar credit card bill and the people we owe could just be waiting to spring the bill on us. We bought billions of dollars' worth of Chinese-made goods. They buy almost none of ours. In the end, they gave us all this business.

Result: according to ages-old international trade policy, we "owe" China big time - to the tune of 430 billion dollars' worth of business.

WHY DID IT HAPPEN?

Problem is: we're buying more than we're selling. The things we wish to sell are either of no apparent value to most folks overseas, or we sell this stuff at too high a price. They could just as easily make it themselves at home for a much cheaper price.

To exacerbate this: