According to CIA, Americans have led the world in consumption this past year, and China took the largest trade surplus. This does not reflect positively for the American economic machine. Nations frequently become powerful via growing exports, not excessive expenditure. The statistics imply a slow down of American economy via little exports coupled with heavy borrowing.
Growing debt is undesirable. The numbers suggest largely financing from China for US inbound purchases. As much as American culture thrives on consumption, increased dependency on foreign lenders does not display aspirations of the collective economy.
A possible conflict of desires between individual consumers and the combined nation has brought about current fiscal condition. US once served as the largest creditor of the world, yet presently the most prevalent debtor. Nevertheless, to remedy and increase national fiscal responsibility, it begins with political will.
Political Implications
US government does not discourage Chinese sourcing, possibly because China has become the second largest purchaser of American treasury bonds today, behind Japan. In other words, the US government has accumulated a fair sized, 492 billion dollar loan from Beijing authorized lenders.
Increased lending from China or any other nation typically arrives with strings attached, and the stipulations frequently go against interests of the American people. This could partially account for the questionably reluctant massive consumption of Chinese made goods.
Limiting US Dependency on Foreign Creditors
A step closer to potential solutions calls for sufficient education in financial responsibility. The American people deserve accurate, up-to-date information of current fiscal conditions, and have their voices heard. If the population becomes more aware of current affairs, political pressure may accumulate toward some timely decisions.
Spending cuts remain critical. As mentioned by various presidential candidates, the US government could streamline operations and remove unnecessary expenses. The added efficiency not only helps lower spending, but could also more effective governance.
Reducing federal budget however, would probably not happen without oppositions, as no individual government body desires for lower funding. More often than not, remedies require necessary sacrifices. The government means to serve the people, and setting good examples could inspire enough to make a difference.
Encouragement toward creative research and development instead of price point competition could create the next breed of American innovators. Novel business models dominate relevant markets regardless of prices. Cutting edge technology, ingenious management schemes leads to new employment opportunities domestically, and lessen need for foreign borrowing or sourcing.
Political Will for Effective Action
Conclusions from continuous corporate dealings with Beijing remain ambiguous, and immediate remedies demand fervent political will. Lawmakers and public servants could promote necessary changes, and make US more self-reliant once more.
Realistic plans to repay foreign loans along with domestic pledges could improve present economic outlook dramatically. Washington holds some of the best minds in the world, therefore foregoing dependency of lending or sourcing from regions like China should remain a choice, not a necessity.
