Nickname: Ajay Kumar

Review: While counting the US trade deficit have the economists taken into account earnings by US based corporations from overseas investments in oil companies and huge investments in China and other transitional economies? I strongly feel this trade deficit actually is a hoax because the reality is that it is US companies in China/India only who are exporting like mad to USA and making huge profits which again get deposited in US or get reinvested in same countries as US assetts outside USA (and they are substancial). Mr Bernanke has mentioned earlier that there is no real accounting of such US assets and profits abroad.

Date reviewed: Mar 13, 2006 6:16 AM

Nickname: Lou

Review: I am a Canadian economist. Canada was in a similar situation in the early 90s. We had large government and trade deficits - we are fine now but the 94-98 period was very painful for us - we were forced to act; to reduce govt expenditures and increase tax revenues with a consequent economic contraction. We now run surpluses and have the best financial picture of the OECD. In assessing the situation, find that there is a key statistic that was not discussed: the US deficit consitutes what percentage of GDP? how that it compare with other OECD countries. Generally it is not too worrisome if debt less than 25% of GDP; also, what percentage of govt expenditures are financed by debt? not too worrisome if the govt. takes the issue seriously enough to plan reductions in deficits. This is not too different from a household - debt and deficits are ok if the entity has the debt carrying capacity.

Date reviewed: Mar 13, 2006 2:26 AM

Nickname: X24

Review: The article is a quick overview of what it going on unfortunately the deficit figures don't include intellectual properties, also there is a lack of accounting for what (relatively) free trade does for a country. We are now involved in a economic system that breaks down the walls of domestic production,and consumption. We are involved in a paradigm shift just like the U.S. was in from county to state to national to now international. We are the beneficiaries of low wages in China and abroad and they are beneficiaries of our technology and innovation.

Date reviewed: Mar 13, 2006 2:10 AM

Nickname: Kurt

Review: You cannot say that "a trade deficit is no worse than a family buying a house on mortgage". In reality it is as bad, or worse, than a family living on credit cards without being able to pay even the interest. Yes, the US and any other nation has to pay interest on the deficit, understand it or not. Continued deficits tend to impoverish the nation, understand it or not.

Date reviewed: Mar 13, 2006 1:07 AM

Nickname: Ron

Review: You discuss things that have been discussed before. It would have more value if there was a little more quantitative analysis on effect on individuals - how much is saved from imports versus the impact of less economic growth. Not mentioned strong enough is that we are currently the largest free market and countries are probably subsidizing some products to generate capital.

Date reviewed: Mar 12, 2006 9:37 PM

Nickname: Barry

Review: It's the law of comparative advantage in action, plain and simple. One way out of this trend it is to restructure, reinvent, and pave the way to a bright future, something which the USA has a history of doing extremely well. The reason the trade deficit has grown is because international borders have become become more open, free trade has becoming more possible, some protectionist barriers have come down, and developing countries have quickly gotten on a power curve. I hope the president and leading clerics of Iran quickly embrace these concepts, accept the Russian proposal for uranium enrichment on Russian territory, and end this tense standoff in favor of a policy of friendly international cooperation and free trade.

Date reviewed: Mar 12, 2006 4:34 PM

Nickname: Real Capitalist

Review: The failure of politicians and businessmen goes back to the inception of the automobile. Instead of using real capitalism (which recognizes the win-win situation) which would emphasize renewable energy sources, business chose to be profiteers (which puts profit ahead of the common good) and congress and presidents let them. When we switch to real capitalism, the country and the world will be better off.

Date reviewed: Mar 12, 2006 2:13 PM

Nickname: Bob

Review: This was a well balanced article. I am curious about how much we could afford if we couldn't rely on less expensive imported goods. How would it be possible to control inflation and rising costs without cheaper imports exceeding exports? What would one have to pay for a GM car if they did not have to compete with Toyota and Honda?

Date reviewed: Mar 12, 2006 1:05 PM

Nickname: Big Dave

Review: Business Week, one of my favorite magazines, has had its head in the sand on this issue for a long time. The reply from Jesse is right on. Which part of our $8 trillion debt ($100K per household) don't you guys get? This should be your cover story every week until we pay it down. Wake up!

Date reviewed: Mar 12, 2006 4:42 AM

Nickname: JESSE

Review: As a whole, politicians have failed us miserably over the past 60 years. They are to blame for our possible eventual demise. This may be both economic (the federal deficit) and our terrorism (intolerance and hate for the USA). It's not to late, we can correct both and become the country we all dream of. Two pieces of advice we should tell our kids and our politicians: Pay your bills and mind your own business. For Mankind please pray for Love Peace Hope Truth and Understanding

Date reviewed: Mar 12, 2006 1:25 AM