by Elliott R. Morss

Introduction

Many have bemoaned the loss of US manufacturing jobs to foreign lands. The following quote by Mark Riddix is typical:

One of the biggest challenges facing the American economy is that we lack a domestic manufacturing base. Simply put we do not produce anything anymore. We buy tons of foreign goods and then wonder why we are lacking jobs. We import most of our goods which has resulted in a huge trade deficit and industrial job losses. Our economy has transitioned from an agricultural society to an industrial society to a service economy[1].

And recently, Steve Hansen has argued that job losses are associated with the growing US trade deficit. I quote Hansen:

The burr under my saddle is jobs…. Trade deficits export jobs. Some think it is only money on balance sheet – but it is jobs that are exported when a country imports manufactured goods.[2]