PLAYING WITH FIRE

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Trade Deficit

Henry Ford had the great wisdom to pay his workers well, so that they could afford to buy his cars. America grew after the war because Americans could afford to buy American made. China now understands that if they have a prosperous home market, they can dominate the world. That's why part of their 2019 policy is to lift a further 12 million people out of subsistence. China is developing a prosperous and well paid middle class. If the US does not pay its workers well, it has to find markets for its products overseas. And when there is a president who doesn't believe in multilateral international trade, you lose market share, and, guess what: the balance of trade starts to go very bad. Just like it has in 2018. A 10-year record trade deficit.
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