Jesus christ, if someone lets out all the bears you'll be fucked!

Our trade problem isn't getting fixed. We've forced our masses & manufacturing to openly compete with 3rd world countries with "anything goes" environmental laws, and work forces where child and prison laborers are common place. I don't care how cheap American labor gets. It can't compete with that. The only way we could compete with that is to repeal all labor and environmental laws going back to 1870 which is so absurd it may as well go without mention.

Now if we used tariffs to make the competition more fair; our manufacturing would come back, our masses would be employed again, and between the increase in income taxes [from people returning to work] and the tariff moneys; the budget would be fixed.

But that can't happen since our politicians on both sides support free trade blindly. They do so because it helps the multinationals who have bought them out. The special interests have no reason to care about the middle class or the unemployed because they know the emerging consumers in India and China would be perfectly fine with buying their goods; in other words their profits don't depend on our middle class so they won't be missed. The board of [pick a multinational at random] has no reason to care if a consumer buying their product lives in Mainstreet USA or Peking

It's a hard place to be at. The way the economy and way of life has progressed in "The West" it would be almost impossible to shift things back to a production based economy without some sort of drastic "crash". The number of people in the US or Canada for that matter, that are willing to pay the wages of a factory worker in North America are too few.

How do you pay a guy even $15 for 10 hours to make a table and four chairs when Wal-Mart is going to sell it for $200..? There is no mass of population willing to still pay $1500 for furniture, or $6000 for a computer, or what-ever-else their picking up. People can't afford it, because of the way we've structured the other parts of our life. Like housing prices in Canada or Medical in the US... Food and Fuel prices around the world... There is no budget left for North American factory workers.

The trade agreements have not caused this problem, because we're all in it together. The problem is coming from countries we don't have trade agreements with. Cancelling NAFTA (imports from Canada) isn't going to solve any problems for the US for example, because the problem is imports from China and India.

When your cost of living is $2-$3 a day, it's pretty easy to live off of $5. The ratio of our monies to theirs is what is keeping our manufacturing industries down.

I tjink competition wooth countries like China or India is possible if there are fair rules. This currency dumping from China for example is killing Jobs. The Euro is to cheap because of the overindepted countries in Europe, so German goods are too cheap as well.

I know that furniture problem from here. We've got low wage countries direct before our house door, since the eighties, when the economies of europe started growing together. And the eastern european countries were not underdeveloped. So we lost the textile industrie in the 70ies (Bielefeld was the centre of it in Germany) and the furniture industries which was big here, in the 80ies or 90ies and had unemployment rates about nearly 10%. A 100 miles southward the mining and the steel industry cracked down wich caused much bigger problems. The only chance to get jobs back is automatization, better organisation (just in time for example) and innovation. Which means costeless education in engineering subjects or business management. Languages could be useful as well. When I see the low car prices in America, I can not understand why they don't export them. America got enough oil and gas to provide itself, so there are lots of competitive advantages that can be used, if competitive distortions would be abolished and the US economy would focus the international markets. I think qualification of the people in a much wider range is the only way out of the crisis. But there is no easy way.

Euro crisis goes pop. Some comment from England. youtube video

We export a lot of our vehicles. In fact, the number of vehicles we export is steadily growing.

@sleepless. Regarding NAFTA, The primary country that benefits from NAFTA is Mexico. U.S. Businesses are able to operate with less restrictions and regulation than here in the United States. Mexico profits from this, as they become a more attractive place for businesses to set up shop.

I live in California, and we are in a huge deficit. A huge problem with California is that there are quite a few regulations, restrictions, and procedures in order for businesses to get set up here. When a neighboring state says "not only do we not have the same rules and restrictions as California, but we also give you the land as opposed to paying for it like California would, the business will almost always go to the state that gives them that opportunity to get established. That's pretty much why multinational businesses around the world are going to China; they have less restrictions than the West does.

With that being said, if we remove the regulations and taxes that hurt businesses here we will start to get back on track with our recovery.

That's why our airlines reacted to this recent "tax holiday" by jacking up the fares?

The reason why the recovery is having problems is because there is no demand for goods. Companies don't exist to be charitable. They exist to make profits. You can't make profits by hiring when demand is super low. You hire to fill demand and in this case the demands are already met [if not over saturated]. People can't afford to buy anything right now. Until that gets better, there's going to be few and far between reasons to hire anyone.

Perhaps if we stopped all this corporate welfare we wouldn't be worrying so much about figuring out where the debt ceiling should be. The market could really use some stability in that subject. Why hire anyone when no one knows whether the country is about to default?

Speaking of which:



If I was a ceo of a fortune 400 I wouldn't be hiring a soul right now. At any price.

If there is no compromise in the last minute the USA will loose it's triple A Rating. At the moment nearly 50% of the public household is financed with credits. If there are no hidden reserve assets, nearly 50% of the public checks can't be send any more. There will be serious damages of business and a lot of suffering people. I can not understand why they make it worse like that. The costs of new credits will rise. It's like a new tax for all Americans and a new dip becomes inevitable. America as well as Europe have serious problems to implement rational economic policies. China will become similar problems right soon. Public debts are about 80% of the national output meanwhile (regional gouvernment, cities etc.) and probably will loose big parts of it's dollar bonds, because of inflation. The only hope for growth in the world economy are some emerging countries which did not waste their chances with public debts.

Jacking up the fares deal with a great amount of administration costs required to run Airports (which is a lot), and running the airlines themselves. How many travelers are there during the holiday? It makes sense to jack up prices during the holiday because you have to move so many people, to so many places, and often you're up against the weather. You also have Liability insurance in case someone gets hurt, or your baggage gets eaten by some machine, You also have to maintain equipment. This is pretty much part of the reason why the cost of tickets rose.

And no demand for goods? The western nations are HUGE consumers, and bunch of other countries (including China + India) are becoming consumers because the standard of living is improving in those areas. The only time when there will be no demand for goods is when no human is alive on earth. There will ALWAYS be a demand, but you gotta find what's in demand and jump on it like lion jumps on an antelope. This is where marketing comes in.

I agree we need to end the corporate welfare, and let the businesses compete with each other. The business community is about survival of the fittest. If the business cannot deliver a proper product, or operate as it should, it has earned the right to fail. Once this happens, the vacuum will be filled by a business that is willing to exploit the opportunity. I also don't believe corporations should be politically aligned (I know it's unrealistic you don't need to say it). GE, JPMorgan Chase & Co, Citigroup, Morgan Stanley, and more supported the president; all required bailouts, all received bailouts. Despite their shitty business practices, they are running when by all accounts they shouldn't of been.

Regarding the "Companies don't exist to be charitable" comment; very bad generalization. It behooves businesses to be charitable. Did you know that the vast majority of the money to repair natural disasters around the world came from corporations and not the government? Being charitable with money is SMART, and businesses are starting to realize this. McDonalds has Ronald McDonald house that helps out kids, Walmart donated $250 million in 2006 when Katrina hit, over $110m was raised by businesses for Japan's earthquake/tsunami disaster this year. Does this mean businesses can do no wrong? Hell no. But we can't completely dismiss the good they do within the communities.

So I'm going to say this: "Companies exist to invest into the people, while the people invest into the company in return" The ones who don't follow this typically won't last long, cannot be sustained under capitalism, and will require revenue from another source to stay afloat (government bailouts).

If you were a CEO of ANY business, your primary goal would be try to increase shareholder wealth or you're out of the job; And you aren't going to do that by sticking around in a country with so many regulations you'll be fined if you so even let out a fart. You'll be taking money OUT of U.S. Banks and putting them into the banks of other countries *cough China* *cough India* so you can avoid federal taxes within the U.S. China's doing something right. It's providing fertile ground for businesses to grow, and it's all thanks to not having the restrictive regulations + taxes you'll find in the west.

I linked up an article below to illustrate what I was talking about earlier.

http://articles.boston.com/2011-07-29/b ... nvestments

I should clarify: The "tax holiday" I spoke of was not a real holiday. What happened was; under normal circumstances the airliners have factored into the price of fares a tax that helps fund the FAA's operations. Due to a technicality this tax momentarily stopped existing. The travel industry referred to this period as the "tax holiday" because the tax suddenly disappeared. There was no "collect it now and pay us later." It simply ceased to exist. The fares sold in this period did not have this tax at all and were never to be subjected to it.

Yet instead of cutting back the fares by whatever the tax was [or even just keeping them the same], the airliners jacked up the price of their fares and when questioned told people that it was because of changes on the part of the FAA. Which is absurd.



There is no demand for goods. People are being squeezed so hard by job losses, the plummeting house values, the disappearance of their retirement savings, health insurance cost increases, gasoline hyper speculation, and inflation that they are cutting back on all non-essential spending. Overall consumer spending is extremely weak. Consumer borrowing is extremely weak. This is taking away incentive to hire right now. If I ran a business dependent on tourism for example [like a hotel], I would know to expect fewer guests this summer than last summer or the summer before that. So why would I hire more housekeeping, more front desk clerks, more managers, or more security? The truth is: I wouldn't. Likewise if I were a car dealer I would know that people aren't buying as many new cars now that the economy is so tough unless they have to. They'll keep using their existing car for another year unless they wreck it or it breaks down. So why would I hire more car salesmen or customer service clerks? I wouldn't.



I never said they don't do good things. I said they don't exist for those reasons. They exist to make a profit. If they don't make a profit they cease to exist.

Companies in competition are not always the best solution for public infrastructure for instance. They pick the most profitable regions and forget the other ones. On the other side monopoles have to be avoided, because they become extremely expensive for the rest of society. Roosevelts New Deal was the best example for political induced demand. Investment in infrastructure is a) demand for business and means b) a better environment for it. Actually the USA spend a lot for military and not enough for infrastructure like streets, data highways and education. Public companies like the Federal Post are inefficient and expensive. It might be similar in the social bureaucracy. The American health system for example is very expensive and ineffective compared to other systems in the world. Democrats and Republicans obstruct each other instead of working out compromises. So the only solution for America is, to allocate more money from unproductive investments into productive investments. Less tanks, more streets. Less pensions more schools and to raise taxes for the big capital if they don't invest in jobs.

I don't think that ecological policy and the environmental protection is a task of private welfare. They waste much more natural environment than they rescue. It always need laws to implement catalysators for example and after a while it's a good business. One of the most productive investments private investores can do is to reduce the mileage of their cars for instance. But there is not much done up to now. 2 gallons for 100 miles should be the max for individual traffic. Without laws there will be just slow progress in environment protection. And there will be always strong contradiction from the business, although it's proven that clever investments in ecological technology make sence for national economic.

I found this exceedingly interesting so I thought to share it here.

Keith Olbermann on the Budget Compromise

Thanks for the clarification. Though I don't see the connection between the "tax holiday" and regulations that normal businesses adhere to; as they operate much differently than they do. But I have to say that airlines aren't really what the removal of regulations and taxes are meant for, as their taxes are for paying for the services they rely on (such as the things I already mentioned), while other companies pay taxes just because the government needs the revenue. I can assure you the gov't doesn't get much revenue from airlines, or the stockholders for that matter



Do you mean there is no demand for luxuries? If so then I agree with you there. When you said "there is no demand for products" I took it as "there is no demand for luxuries or necessities".

In a bear market, people will start spending more on necessities, than luxuries. People will go to a store and say "hmm, I can't afford Green Giant string beans, so instead I'll go with this generic brand". The makers of that generic brand will in turn get more revenue and there will then be a demand for their product. And you're right, they won't spend money on a new car and they'll make the most out of their vehicle. They'll spend more on the necessities (maintenance, spare parts, ect.) than that flashy new BMW. I'm doing the same thing, I have a 98 GMC Sierra and I'm buying more parts to do my own repairs rather than buying a sexy new truck with accessories. I'm riding mine down until the engine falls apart.



Rgr. Though the business better not mention that to the consumers, or else they'll go out of business. Imagine Steve Jobs coming out and saying "We exist to make a profit". I admit I would laugh my ass off because I have a dark sense of humor, The rest will take offense and boycott his products.

Exactly, it's the harsh reality no one likes to talk about. Because they exist based on how profitable they are; businesses can't just go out there and hire a thousand people for the hell of it. What they need in order to hire someone is for the demand for their goods or services to increase beyond the company's existing capabilities. As this demand raises people get hired, as this demand shrinks people get fired. Our jobs problem cannot be fixed unless demand for goods & services increases.

This does, like you said, inspire people to buy generic foods over brand names and this increases the demand for generics and increases the workforce for people in certain specific companies that produce them [or retailers in the case of dollar stores] but the increase in jobs that are created this way has simply no comparison to the number of jobs that have been lost as consumer spending grinds towards a halt. It's not like 1 job disappears at Kellogg as 1 job is created at Foodclub. It's more like 1 job is created at Foodclub while 1,000,000 is lost in the realty industry/tourism industry/furniture industry/ so on. People may change what they eat, not so much how much they eat. They're not suddenly eating more in proportion to the amount of spending they're pulling out of vacation trips & fancy landscaping.

Nothing from DC has been done by either party to address this.

Ideally they would try a Keynesian approach by placing orders with American companies to drive demand up. This probably would be a viable option if we weren't pegging the debt ceiling with the boomers entering retirement.

But since we are bouncing off that debt ceiling the only way [that I can see] we could drive demand back up without crazy-amounts of government spending would be through major tax & trade reforms. Imagine if we got rid of all income taxes and started funding the government solely with tariffs on imports. What people would pay in tax would depend on not what they spend [like the unfair tax], but what they spend it on.

This would cause a sudden death to global economy. Other countries would do the same and there would be a decline of business in the USA as well. The stock markets would crash, the banking system would collapse and so on. Although it's true that America has to reduce the trade deficit it should avoid trade wars with Europe and China. Instead of that there must be more investment in the US production. The major companies are forced to invest more in America if the dollar becomes cheaper. BMW, Volkswagen and others produce more and more cars for the American market in America. Airbus is producing lots of planes in China, that would be a model for America as well if US Airlaines will buy more of their planes. All America needs is a cheap dollar and more investment in the productive parts of the society. Medium sized producers should be promoted through a better environment of public education institutes and lower taxes. Therefore the finance sector could pay more taxes. Laws like that could be globaly coordinated. That would reduce speculation and increase investment in jobs. One of the biggest problems is the coupling of the yuan/renmimbi at the dollar, (there are othr currencies as well) They should float, so that the markets can do their job.