This website uses cookies to ensure you have the best experience. Learn more

The United States' Trade Deficit Essay

750 words - 3 pages

Introduction:
These days, almost every country involves in international trading. To set the basic knowledge about international trading, there are two important terms: trade surplus and trade deficit. Trade surplus is when the money amount of export exceeds import, and trade deficit is when trade import exceeds export. U.S. has been stuck with trade deficit for years now and it has caused problems such as lowered U.S. credit, or less favorable trade condition. This is a very complicated problem that it may take long to resolve the problem, but it is not something that is impossible to solve. One of the best solutions to resolve such problems would be increasing in government spending to support domestic goods. (solution not defined yet)

Problems:
To balance the trade deficit, U.S. has been borrowing money from other countries including its biggest trade partner: China. It is possible to borrow money from many other countries especially when such country like U.S. have other countries trust. However, it is not the same as how it used to be in the past. As a result, U.S. credit which used to be graded at AAA has fallen to AA. At this point, this is not a severe problem because AA is still a stable credit level that U.S. would be able to borrow money from others in the future. However, if U.S. continues to stay in trade deficit and borrow more money every year, then the credit rate will continue to fall and U.S. will have less and less countries to borrow money. With less money borrowed from less countries, the amount of money borrowed would be not enough to balance the trade deficit that U.S. have.
Due to the situation that U.S. being financially aided by the countries may bring less favorable trade system. Over most of other countries in the world, U.S. may be the super-power country that pressures other countries to undergo with trade system that favors U.S. but that is in case of such countries like Greece that is about to collapse its economy or South Korea. In case of South Korea, even U.S. army is staying in South Korea to support its military situation with North Korea. Since South Korea gets aid from...

Find Another Essay On The United States' Trade Deficit

A critical Analysis of Trade imbalance between China and the United States

6553 words - 26 pages of production, it is possible for a country to run a virtually permanent trade deficit with another country that nevertheless benefits both countries; the oil- dependent United States tends to run deficits with petroleum-rich Middle Eastern countries, for example. For this reason and others, many economists have argued that global trade balances are more important than particular bilateral trade balances.By this measure, China's trade imbalance

Free Trade and The Global Economy/A comparison between the United States Chamber of Commerce and the AFL-CIO

1107 words - 4 pages Free Trade and The Global EconomyWhat is free trade? How does free trade help the global economy? Are the current free trade laws helping the United States economy? The United States Chamber of Commerce views on free trade and the global economy differ from the AFL-CIO views. While the government seems determined to stay with the current trade issues in place, the AFL-CIO is demanding changes be made to protect workers worldwide.An arrangement

Case Study: Kanzen Berhad: The United States and AntiDumping Duties Globalization, international business, non-tariff barriers, and international trade issues

1622 words - 6 pages global marketplace, it does not benefit the end consumer, in fact, the higher prices or tariff actually helps the competitor as it is now charging a premium for a product that costs very little to produce. It does not help the U.S. industry; it only hurts it. The end result is a lose-lose situation for both countries involved in the trade barrier. Free trade and globalization are the only effective means to generating economic increases worldwide.ReferencesIVEY, Kanzen Berhad: The United States and Antidumping Duties

Trade protection in agriculture by European Union and the United States results in gains for some and loss for others. Evaluate the impact of US Farm Policy or EU Common Agriculture Policy on...

2328 words - 9 pages Question 2Trade protection in agriculture by European Union and the United States results in gains for some and loss for others. Evaluate the impact of US Farm Policy or EU Common Agriculture Policy on developing countries.The European Union (EU) is the agricultural leader among developed countries in international trade. It is well-known as a world's major food exporter. In 2010, for example, its agricultural exports, mainly processed foods

The United States History

660 words - 3 pages Throughout the 1800's, The United States went through a giant growth. The population doubled from 39 million to 76 million people. I think that this happened because of the immigrants from Europe and many other places around the world. Another reason why I believe that the population nearly double was an enlarged birth rate. The United States had to take action. They adopted the most liberal land policy in history. At that time, America started

The United States Navy

1289 words - 6 pages Organizational Structure The United States Navy is one of numerous organizations of the military and has been since October 1775. The U.S. Naval has the world's biggest carrier fleet and continues to dominate all dangers pointed at the United States along with the Air Force, Army, Coast Guard, and Marines. I will depict and assess the structure and function inside the United States Navy, contrast it with its fellow branches, and demonstrate its

The United States Government

1049 words - 4 pages The United States government consists of three branches: the legislative, executive, and judicial branches. These branches were created to be coequal with overlapping powers that keep each other branch in check. The branches of government were designed to work well together and be being coequal would result in making decisions that are in the best interests of the people. Each branch is crucial to making sure the federal government works

Schooling the the United States

1635 words - 7 pages The world we live in is designed to keep people with power in power and the ones without power without power. As we go through our respective schools one thing remains hidden from the ones going through it. What is remaining hidden is their real intent of the school system. Why are the people with power making use go to school in the United States and most of the world. John T. Gatto talks about the real intent off school in his essay

The United States in Decline

2366 words - 9 pages suggested, would be the implementation of a cap and trade program or a carbon tax that takes into consideration externalities, yet a global consensus would be required. The lack of cooperation from the previous presidential administration suggests that the United States primary objective is not the environment but rather its own personal interest. Domestic Issues and Economic Deficit Zakaria’s argument is less problematic because it pictures

Unemployment in the United States

3074 words - 12 pages problems between the United States and Mexico exemplifies the difficulties the US labor force is experiencing with international competition, and this is the question of the masquiladoras. Masquiladora industries is based in Mexico, along the US border; referred to as the twin industries and are assembly plants that, according to the International Trade Commission (ITC), are focused in the manufacturing of electric and electronic goods, textiles

The united states steel indust

909 words - 4 pages . Steel that was previously exported to Asia from Russia and elsewhere in being diverted to the United States and other markets. In addition to this, subsidies continue to distort the world steel trade. Subsidies are given to steel producers in many countries around the world. For example, the Korean government has provided over $6 billion to the now bankrupt Hanbo Steel Company. In contrast, the United States steel industry has generally

Similar Essays

United States Budget Deficit Essay

3778 words - 15 pages United States Budget Deficit "Spending financed not by current tax receipts, but by borrowing or drawing upon past tax reserves." , Is it a good idea? Why does the U.S. run a deficit? Since 1980 the deficit has grown enormously. Some say its a bad thing, and predict impending doom, others say it is a safe and stable necessity to maintain a healthy economy. When the U.S. government came into existence and for

The United States Current Account Deficit

1417 words - 6 pages The largest and richest world economy belongs to the United States (“North America,” 2011). Interestingly, this same monstrous economy also holds the title for the largest current account deficit. The U.S. current account deficit is funded from net capital inflows from abroad and has continued to grow throughout the last two decades (Holman, 2001). Economists in the early part of this century theorized that this huge U.S. external

The United States Trade Pattern With Mexico

1659 words - 7 pages hundred and eighty million. In 1992 there was a constitutional change that abolished restrictions imposed on the Catholic Church in 1917. In December President Salinas, United States President Bush, and Prime Minister Mulroney of Canada signed the North American Free Trade Agreement, or better as NAFTA. The Mexican Legislature ratified it in 1993 and the treaty went into affect on January 1, 1994. This created the largest free trade zone in the world

The Canada United States Free Trade Agreements

1215 words - 5 pages The implications of the Canada-United States Free Trade agreement and the subsequent NAFTA agreement pertaining to Canadian trade with the United States.The arguments in favour of these agreements include:1) Comparative AdvantageThe notion is that everyone will benefit when countries specialize and trade freely what they produce most efficiently. Less intervention by the government would enhance the process of free trade and help achieve the