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Originally Posted by Nobama
Please enlighten me on how having billions in trade deficits with Mexico, China, UAE and etc benefit the economy in the USA? Yes I understand the goods are cheaper to purchase but at what cost to the overall economy? Obama recently had to borrow 4 trillion dollars to keep the lights on in his administration until November. Is your solution to keep borrowing money until infinity? It's worked up until this point right? Maybe if Bernie is voted in he can incorporate the Trudeau plan in that "Everything is Awesome" and free healthcare for all with lower taxes. If you can't get it yourself don't worry.... The government will get it for you  |
Well they don't benefit the US economy but according to some the US taxes the rest of the world by forcing them to use the petrodollar which skews the deficit. It's also been said protecting the petrodollar was the real reason for the Iraq invasion.
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When the industrialized age first began the U.S. was the top producer and exporter of petroleum. The U.S. would only accept payment for it's oil in the form of dollars. This would force other nations to open up their markets to us. We would use our dollars, which were backed by gold at the time, and use it to pay for goods and services from other countries. After this trade the other nations would then use their dollars as payment for our oil. This would create a huge demand for dollar reserves. Nations would now have to stock up on dollar reserves in order to pay for its oil, otherwise each nation would have to open its markets to the U.S., trade its goods for dollars, and then buy its oil. It only made sense to stock up on dollars in order to purchase oil whenever needed.
This was the tax on other nations which led to the U.S. becoming an empire. The rest of the world was now paying the U.S. "two apples for one orange" and the huge transfer of wealth began flowing into the U.S. This payment for oil denominated in dollars became known as petrodollars.
Today, countries keep a stockpile of dollars so whenever they need oil they go straight to OPEC. Because bankers are always increasing the money supply which causes inflation, the countries that have these stockpiles of dollars are being taxed a second time.
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http://www.deathtocounterfeit.com/petrodollars.htm