Are We Nuts?!
We Americans are a patriot bunch; and with good reason. We enjoy an extremely high standard of living, high levels of home ownership, secondary educational opportunities that are the envy of the world, and we appreciate our personal, social and democratic freedoms. It allows Americans to dream that everything is possible.
There is one way, however, in which we fail to express our nationalistic zeal. Economic patriotism. With this I say politely but firmly; are we nuts? We are quick to cheer our Olympic athletes or to proudly display our flag. Yet, we fail to recognize that as we fight a war on terrorism, we don't mobilize ourselves to support the economic battles at home. Very simply stated, as consumers, we don't take into consideration the economic impact of our purchases. For 2008, our trade deficit was $816 billion dollars (census.gov/trade balance), or almost 5% of our gross domestic product. For perspective; this current recession, the worst in 70 years, our economy has shrunk by 3.3% or over 1 and a half percent less than our trade deficit.
Economists have often said that the curse of a developed economy is a negative balance of trade. Obviously, we can't compete with the China's of the world where labor costs are pennies per hour. Yet, the curse of a developed economy is not universal in terms of trade. For instance, Japan, Germany, and Sweden all enjoy positive trade balances. When compared to our trading partners, sadly, America comes in second in virtually every instance. To our friends to the north in Canada, our deficit for 2008 was $78 billion dollars. With Japan, it's $74 billion, and even with our former cold war adversary, Russia, our deficit was over $17 billion. To be frank, this is economic suicide.
The source of this quagmire is two fold.
American businesses, especially manufactures, have been extremely aggressive to keep labor and product costs down, improving the bottom line, and to make stockholders happy. In doing so, millions of jobs have been lost overseas.
Consumers are the second source of this problem. Often, we dictate our decision based solely upon price. It is time that we realize that every product has two prices, the retail price and the social price. The social price is a declining middle class, poor introductory jobs for those with minimal skills or education, and a new economic category called the 'working poor'.
The only solution is economic patriotism.
When possible, ask where a product is made or a service is offered. Retailers in particular, are very sensitive to consumers' interests.
If you can, buy American. I realize that is extremely difficult in this day and age but items are still manufactured domestically. Please remember that next to your home, your second largest purchase is a car. Do consider either an American firm or a foreign one with facilities in the States.
It is time to rethink the word 'imported'. At the present time, it offers connotations of style, taste or even sex appeal. For instance, we drink 'imported' beer or drive an 'import'. From an economic perspective, the word 'imported' needs to be seen in more damaging terms.
Here in Vermont we love to 'Buy local'. Why only local support? Can't 'local' be defined as being domestic?
Finally, it is not only America who will benefit. Should our economy self-emplode, we will bring the rest of the world with us. This will make our current recession look mild.
Yes, America, it is time to participate in a new form of patriotism; with your wallet. After all, you made your money in America, shouldn't you spend it on America?!?!