Why is the trade deficit with China a bad thing?
484426
Chief Allies: American Consumers, Iran\nArchenemies: Japan/India\n$50 billion per year of foreign investment, a labor force that survives on $70 a month, has enjoyed a 9% GDP growth for 25 years....all under state controlled pseudo-capitalism, has a spiking fuel addiction, and just inked a $70 billion three-decade natural gas deal with Iran\n\nEconomy: China has an economy so robust that to keep the value of its “Yuan” in check, the People’s Bank of China has been propping up our currency by accumulating American dollars, bonds, and treasuries—about $533 billion at last count.  By keeping the currency undervalued, the Chinese are telling the world, “We can provide you with low-cost goods,” Communism may be nearly dead in all but the name in China, but it survives in the form of one last taboo: the fact that the right of an individual to won agricultural land is tenuous (weak) at best.\n\nProblem: China needs to address the fact that its farmers have missed out on the double-digit growh that has transformed urban China and turned its richest cities into some of the most dynamic in Asia.\n\nProblem: If China decided to drop/dump its dollar reserve on the world currency market, interest rates here could skyrocket, severely damaging our stock and housing markets.  However, that probably won’t happen because China needs American prosperity to continue its growth, and Americans with extra dollars love Chinese imports.  It keeps the Chinese economic juggernaut rolling.
247879
All events have good and bad. They are an ally and need to stay strong because of the China threat.
303394
We owe Communist China Multi- Billions in trade deficits. Our American companies (Wal*Mart) found that worker rights cut into their profits. A shirt sewed by a 10 year old Chinese girl cost much less than a shirt sewed in a union shop. The Chi-com shirt is no damn good so you will buy another in a few weeks. By the way the reason for the deficit   ///China won't buy our goods either.
209780
Short term negative trade is great for the consumer. That means of course more stuff is coming INTO our country than is going out.  For some reason we allow all of this cheap stuff to come in from China and Belize and people like me go to Walmart and get $20 shoes instead of $60 shoes that were made in Massachusetts where the shoemakers used to get a decent wage and benefits before the American shoe manufacturers were driven out of business and shoe manufacturing was outsourced to China and India.  The shoe industry owners and management and share holders don't care who makes the shoes as long as it's done cheaply enough to keep them making a nice profit and they lean on the government to keep the imports coming - they HAVE to - all of their factories are overseas now.  If there are any domestic manufacturers left they are forced to keep their prices as low as possible because of all of the competition from cheap imports - supply and demand.  I as the consumer win in the short term because I get a pair of pretty darn good shoes at a rock bottom price.  I lose as an American because American jobs are disappearing, our tax base is eroding as we lose workers income taxes and industrial taxes at the local, state and federal level.  Jobless people swell the welfare rolls, Social Security input decreases.  The only possible advantage I can see is that it makes us more interdependent on one another internationally.  I mean how likely is China to nuke us or cut diplomatic ties while we supply a insatiable appetite for their goods. It would be like a shopkeeper shooting his biggest customer.
787519
There are many issues here.\n1) Imports may be cheeper and still be as good or better.\n2) Importing goods is "exporting" jobs. Can lead to unemployment and downturns in the local economy.\n3) Limiting imports stops local firms from improving production processes as they make good profits under their production.\n4) Sometimes imported goods don't have the warranty and after sales service as local goods.\n5) Importing from one country often opens the door to exporting to the exporting country.\n\nCan be advantageous but has disadvantages as well.
614164
US trade deficit is too small compared to its GDP (nearly $12 trillion).  While trade deficit is a minor problem, global supply-demand will keep varying over the years and this could change the trade-deficit. Further, the deficit is paid by foreign investment, which means Americans aren't saving enough. When the interest rates are very low they won't save much money but spend it on commodities which includes importing from overseas. When the rates go up there is incentive to save it in term-deposits and other safe investments.  It is a tricky complex phenonmenon that will get resolved on its own with time but as of now it is not an alarming situation.
495471
Well the pro's of any country becoming a developed nation are obvious--diversification of resources, new innovations (eventually), and a shift in the balance of world power (hopefully China will remain peaceful)\n\nThe biggest con, and not just for the US, is that China is a country of 1.4ish billion people who are clueless to their own country's emergence as a significant world power.  They are force-fed the statistics and are clueless at the increasing influence of China in international affairs.  What's worse, they could collectively care less--they spend their free time playing mindless games and singing songs.  It would be RARE for the average chinese person to ever ask a question like this one.  Pure ignorance
351669
A trade imbalance does not necessarily imply that there will be a negative effect on a country running either a trade deficit or a trade surplus, as there can be other factors within a nation's economy that allow that trade deficit (or surplus) to be beneficial.  The consequences of that trade imbalance may also be a short term benefit, but with adverse long term consequences.\n\nTaking the US economy as an example, it has been running a trade deficit for many years, as well as a budget deficit, yet it has enjoyed, in the near term, productivity growth, a strong employment market, high consumer confidence, and with the recent exception of gasoline, fairly low consumer prices.  While long term consequences, such as adverse effects from foreign purchasing of US debt, as well as the long term growth of the national debt causing problems in the future, in the short term, the trade deficit has overall  contributed to our economic well being.
430859
Great!!\nGood criticism.\nI think that China has such powerful econimic policies that even the US firms have opened their offices in China.\nThey have such a cheap manpower that every company would like to work in China and probably this is the reason that even the US stickers are made in China.
862898
The debt and deficit have no peer in the problem of economic waste. There is a contant danger of increasing interest rates ballooning the payments and every dollar is a loan from other countries who could stop lending us money and squeeze our economy. The Chinese are very aware of our deficit problem, and no one wants to address the problem. They own 40 percent of our debt and they are flooding our markets with Walmart goods. They are also attempting to capture the oil markets we depend on, this is a tragedy waiting to happen. We are not supporting our education system to compete with other countries who are producing a superior work force. The engineering crisis is untenable, India is producing most of our engineers and taking American jobs. You can not compete in the global economy without a superior educational system. Economic collapse is what killed the Soviet Union and we are following their example.
1129511
It's not really a case of losing courage when you look at the size, growth and devlopment that is occurring in China.  We are not the only super power in the world today.\n\nThe real risk would be if China decided to call in the US loans resulting from the deficit, stopped buying US denominated bonds and put trade restrictions on US imports.  After all without China the US Dollar would be flushed down the financial toilet instead of treading water in the toilet bowl!
528282
Yup...everyone is right.  The dollar seems to be weakening. The trade deficit is growing, especially with China, and therefore, they have been hoarding dollars, which means that, to some extent, they do "control" our currency.  And basically, all of this is particularly hard to predict, so "who knows?"\n\nBut really, one of the bigger issues is that we've been spending like crazy with our recent budgets, and that money doesn't come from thin air (well, perhaps it does, but it does affect the currency market).  In the end, the U.S. is due for inflation, and since other nations have been more responsible in their fiscal and monetary policy, our currency will probably continue to fall over the long run.  The fact that the Chinese have been holding on to dollars lately has had the most positive effect on the dollar, but that can't last.  Eventually, all those dollars will come back here, and that will weaken our currency against theirs.
318959
China is not only growing at an incredible pace in industry and trade, but it is beginning to exercise more power all over the world.  Right now, China has interests in almost every corner of the world, including heavy involvement in world ports and other trade routes.  The problem with China is that it is right now opening its doors to everyone and everyone is opening its doors to them.  It does not seem like a threat... but, at the same time, it is selling arms to Iran and North Korea and spending huge amounts on its military.  There are old scars between Japan and China.  There are present conflicts with Taiwan.  Both could involve the US, against Chinese interests... I believe they are holding off on flexing their muscle until they have grown larger in economic and military dominance.  It is coming... the only thing that saves us, besides the fact that we are right now the only superpower, is that we are also their best customer.  Someday, their economy will be the greatest in the world and they will have more influence in world matters than the US... we will become another France or Germany, still strong but not the big boy on the block.  \nAs far as India, they will have a great economy but it is further away and they are not as interested in world dominance as the Chinese are.   \nStart learning Mandarin.
134690
It goes both ways. American invests in the cheap imports from China. Things such as tvs, cars, clothing, and electronics are exported from that country to the U.S. \n\nYet, U.S. materials and U.S. finances are exported largely to China. Examples include wood, cotton, machinery, dye, food, and businesses. This import/export agreement ,along with low tariffs, gives China the supplies it needs to become a bigger world leader and gives the U.S. more influence in that country.
370962
Because the Chinese govt. has opened its country to foreign capitalist business, and if Yahoo wants to do business in China they must play by the rules that the Chinese govt has set even if it means the good guys get caught. But money is money and that is the bottom line.
171533
It doesn't.\n\nBalance of payment measures how much a company exports versus how much it imports.  if export > import, it's called a trade surplus. if export < import, it's a trade deficit.\n\nA budget deficit is a result of a country's expenditures exceeding it's projected tax revenue.  The deficit has to be financed through loans.
909430
China is getting heavy play on China on the economic side.  China just does not have the power to weld much conventional military power beyond its border.  Generally and military involvement deal with the legal and illegal weapon shipments.\nhttp://www.afpc.org/china-africa.shtml\nhttp://www.foxnews.com/story/0,2933,165695,00.html\nhttp://www.workers.org/2006/editorials/africa-china-0511/