Engineers who are working assignments in Foreign Countries and sending (most of) their dollars home to the USA improves our balance of trade. In the past, foreigners believed that US educated and trained Engineers were superior to their in-country educated Engineers. This advantage has almost disappeared since the USA stopped emphasizing engineering education, science education, and other technical education in our Universities. I have been the engineer of record for the construction of projects in Asia, Europe, Middle East, Caribbean, and South America. US citizens are unaware of the lifestyle advantage that we are accustomed to and take for granted. If our economy collapses, we can become another starving third world country overnight.
Our computer programming technology and expertise (ala Microsoft etc.) helped our balance of payments considerably in the past, but the lack of technical education in this country today has been reduced and will soon totally destroy this export capability, or it already has. The foreign countries have become better than the USA at creating new computer software programs, since the USA has chosen to de-emphasize technical and scientific education in our universities. Asian Countries are now the producers of new computer software technology, not the USA.
I agree. I’m not advocating eliminating the US trade deficit by specializing in services. I’m only saying that theoretically a service-based economy could easily have a trade surplus (if one considers the sale of services in the trade balance, which most economists do not). To take a real-world example if the City of London where to go independent tomorrow I’m sure that, on counts of its insurance market alone, it would enjoy a massive trade surplus.
But of course the US, as it is, has increasingly little to offer to the world. But here I must repeat what I’ve said elsewhere: if the yanks want to eliminate their deficit they must eliminate their federal, state and local budged deficits, as they show one-to-one in trade deficit. After that only economic liberalization could set the US time preferences to fall again. There is no other way.
As long as USA creates a total gross net flow of gold, US dollars, US bonds, and other negotiable currencies flowing into the USA instead of flowing out of the USA, this would be a positive trade balance.
We have destroyed many of the productive sectors of the US economy such as the manufacturing sector, and US dollars are paid by the importing/distribuiting/retail businesses to foreign people and foreign businesses to make many of the things that we consume
Our computer programming technology and expertise (ala Microsoft etc.) helped our balance of payments considerably in the past, but the lack of technical education in this country today has been reduced and will soon totally destroy this export capability. The foreign countries have become better than the USA at creating new computer software programs, since the USA has chosen to de-emphasize technical and scientific education in our universities. Asian Countries are now the producers of new computer technology, not the USA.
Visit the Texas Medical Center (mostly the MD Anderson Cancer Center in Houston) and witness the percentage of women wearing Burkas to get a clue or to estimate the percentage of foreign medical service income currency that is received at the Texas Medical Center. I do not believe that any of these women wearing Burkas are US citizens. Foreign currency paid to our US located Medical Doctors, Laboratories and Hospitals by foreigners improves our foreign trade balance. I think that most foreigners still believe that US educated medical doctors are much superior to their own in-country educated medical doctors, and that is the reason that they seek the best medical care available which is in the USA. We must maintain the US leadership in the medical field.
Engineers who are working in Foreign Countries and sending (most of) their dollars home and this improves the USA balance of trade. In the past, foreigners believed that US educated and trained Engineers were superior to their in-country educated Engineers. This advantage has almost disappeared since the USA stopped emphasizing engineering education, science education, and other technical education in our Universities. I have been the engineer of record for the construction of projects in Asia, Europe, Middle East, Caribbean, and South America. US citizens are unaware of the lifestyle advantage that we are accustomed to and take for granted. If our economy collapses, we can become a starving third world country overnight.
And all of this because there is no incentive in the US to educate one’s self. No one educated Bill Gates, or Einstein, or Tesla. They made themselves, as all entrepreneurs do. If some country, the US in our case, sports a lack of dynamism, it’s all a problem of incentives. If I work hard I get only a marginally better life that the bump who never worked a day. Education is the effect, not the cause. Incentives are all there is to it. Unfortunately, the current US incentive system is unadresable without a major crisis. Who knows what the future shall hold…
“As long as USA creates a total gross net flow of gold, US dollars, US bonds, and other negotiable currencies flowing into the USA instead of flowing out of the USA, this would be a positive trade balance.”
Voluntary exchange is always “positive” in the sense that both parties subjectively benefit from the exchange. If some Asian company gives a USA company widgets in exchange for green pieces of toilet paper, then clearly the Asian company values the dollars more than the widgets, while the USA company has the opposite take.
“The foreign countries have become better than the USA at creating new computer software programs, since the USA has chosen to de-emphasize technical and scientific education in our universities. Asian Countries are now the producers of new computer technology, not the USA.”
Cool, then I can buy cheap computers from them. Meanwhile, Ricardo’s Law of Comparative Advantage says that I will be best suited for some task other than making computers. And Say’s Law shows that I will have employment (at least in an unhampered market).
“We must maintain the US leadership in the medical field.”
Which subjective preferences did you use in arriving at this utilitarian calculation? Which children’s mouths will you seize food out of to help pay for this goal?
“If our economy collapses, we can become a starving third world country overnight.”
I am going to open a restruant specializing in US bonds prepared with your selection of catsup, mustard, holindase, bernaise and other specially prepared sauces, complimented with a salad of freshly printed CDOs, SIVs, ABSs, SPVs, VIEs, CPDOs, SiVs, derivatives, and other similar freshly printed “toxic asset products”.