In answer to Mike Boyd’s editorial on the trade deficit on May 13, present trade relations with China and others is distorted by many factors.  Among these:
ف.  They fail to float their Yuan (yen) per World Trade Organization rules.
2.  They subsidize manufacturing while in the U.S. we tax production.  Subsidies are not allowed under WTO rules.
3.  When they were granted permanent “Most Favored Nation” status, they were to follow WTO rules. They don’t.
4.  They are exempt from Countervailing Duty (CVD) laws.
People think in terms of the past when speaking about trade.  Until recently, U.S. corporations competed with foreign corporations.  Today, large U.S. corporations are fleeing the U.S. labor force and the small businesses that made up their supply chain for cheap labor in foreign countries.  This has never happened at this pace, so old modes of thinking may not apply.
We have large manufacturers using foreign labor to avoid the costs of U.S. labor imposed by U.S. government regulations and high labor costs driven up by unions and minimum wage laws. All this so consumers can obtain U.S. prices at Chinese costs, essentially on credit, like a young, naive child with a first credit card.  How short sighted can we get?
Bottom line: Who is responsible for creating this imbalance?  Who is going to suffer?  What happens to our middle class?  What happens to our political structure as we approach Third World status?
We are importing cheap labor and exporting high paying jobs.  China and India are importing high paying jobs.  Who is going to win that race?  Who is going to buy products when the middle class works at McDonald’s?  What will the value of the dollar be when this reaches equilibrium?  What is our standard of living going to look like?   If you take these scenarios to their logical extreme, it looks pretty scary unless we change course.  And we suffer all of this because we don’t have the nerve to stand up to China and insist they play by the rules.  Are we afraid to confront them because they hold so much debt? Will we confront them now or wait for war?