Nations that think they can export their way out of the depression are kidding themselves.
Trade Negotiations, Depression Edition
Ted Rall
Ted Rall is a syndicated political cartoonist for Andrews McMeel Syndication, WhoWhatWhy.org and Counterpoint. He is a frequent contributor to The Wall Street Journal, a graphic novelist and author of many books of art and prose, and an occasional war correspondent. He is, recently, the author of the graphic novel "The Stringer."
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China doesn’t need to export its way out of the depression. It only needs to stop buying American debt.
Why does your blog seem to have random purges of comments?
I don’t know. However, it is possible that people decide to delete their own comments. It isn’t me!
The USA’s solution is better! The Federal Reserve prints money and purchases bonds from the Treasury. Voila!
Nations can all export their way out of the depression. No joke. Although it isn’t usually done via bartering, it may be more clearly understandable in terms of bartering. Two countries, each of which is cash poor (or two families, each of which is cash poor) barter goods with each other, thereby giving each nation (or each family) the diversity of goods it needs to live (or even thrive).
In the real world it is easier to buy with money than to barter. The solution is to (effectively) print money. By infusing cash into the societies they can buy goods from each other. So long as no nation (or family) prints too much money this works out great! And when times restore to prosperity the governments should remove the excess money. (That we deficit spend even in times of plenty — see 2000-2008 is a serious setback to this system. Don’t let it happen again!)
Or you could go the other way and keep borrowing from our grandkids, great grandkids, great great grandkids etc.
Just think of the third world debt we are leaving as our legacy.