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Trade deficits are a huge advantage for the buyer.

Who wants to spend 12 hours a day doing hard labor when you can pay someone peanuts to do it?

Who do you you think benefits: The person spending the peanuts or the person working 12 hours a day?

Trade deficits are not a problem, but a huge advantage. Trade deficits are self correcting if you don't live on borrowed funds.

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rayiner a day ago | parent [-]

> Trade deficits are self correcting if you don't live on borrowed funds.

But we do.

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s1artibartfast a day ago | parent [-]

Exactly, and that is the problem that needs to be fixed. Paying more for the same things doesn't solve a spending problem. It makes it worse. You could completely eliminate international trade and still have a debt problem. You just slowly sell the country and economy to lenders until there is nothing left.

Edit: when you run a deficit, you trade worthless paper for real goods and services. If you don't take on debt, they have nothing to do with it but spend more and buy more goods. If you limit debt, you get negative interest rates in real terms

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rayiner a day ago | parent [-]

https://www.silvercrestgroup.com/do-the-budget-and-trade-def...

> Government budget deficits are part of national savings. When Washington runs a larger budget deficit, national savings goes down. In a closed economy, interest rates must go up until households save more (and consume less) and fill that gap. In an open economy, the needed savings can come from abroad instead, and as a result we end up running a larger trade deficit.

This would suggest that if we eliminate free trade, inflation will force us to manage our budget deficits.

	▲	s1artibartfast a day ago \| parent [-]
		Only if you cancel foreign investment, which absolutely nobody is talking about. That is a closed economy. Nothing about trade stops you from selling your home and factory and national parks to China so that you can enjoy treats today.