23 January 2017

A plea to save the American economy.

Dear President Trump,

You are in danger of permanently placing China in the driver's seat of the world economy and our dollar in the toilet.

I appreciate the fact that many of your supporters want you to bring back buggy-whip factories, but they are not coming back. No matter what you do, we are not going to be building new coal-powered electric stations. Apple is not going to be transferring iPhone manufacturing to Indiana. Nike's shoes are not going to be sewed together in a Portland suburb. And that's good news!

We have the high paying jobs everyone wants right here in our borders. That Boeing company that you said charges too much money, they build the greatest aircraft in the universe. Tesla has the greatest batteries and electric cars ever dreamed of. Apple may build their devices elsewhere but all of their high paying jobs and profits comes back to the United States of America. And, more importantly, America is the financial center of the world.

We are the largest market as a result of leading the world in free trade. Whenever a standard currency is needed the world picks the American dollar. Want to buy a barrel of oil from any country in the world? The cost is calculated in our dollar. When a country wants a safe place to store their money for the long term, they invest in the United States dollar. Nearly all financial transactions come through America.

Now you want to start a protectionist environment so we can force companies to bring back their low-paying manufacturing jobs to America. It might work, but think about this for a moment:

  • China is now the largest economy in the world.
  • China trades with every country in the world.
  • China wants to lead the world in free trade and have already stated they will take our spot.
  • China no longer wants to use the American dollar as the currency standard.
    • Neither does the middle east.
    • Neither does Russia.
    • Neither does Europe.
    • Heck .. Nobody wants to use the dollar anymore.
    • ... and what held them back is not having an alternative.
    • ... and here comes China with an alternative.
If the world stops using our dollar then our financial institutions (half of our economy) and government will take an enormous hit. Bringing back low paying jobs seems nice until it means that all imported goods cost twice as much because our dollar crumbles. What will happen to our federal budget with no one investing in American treasury bonds?

This doomsday scenario will not happen immediately. It may take the world a few years to switch away from the dollar. But they will. And when they do, it will be the rest of the world that controls the American economy.

All so you could try to bring back some low paying manufacturing jobs.