A severe lesson in economics for the US and how corporate America has actually helped to drive the dollar into the ground!
"If abandonment of the dollar by oil exporters is not the cause of the dollar's woes, what is?
There are two reasons for the dollar's demise. One is the practice of American corporations offshoring their production for US consumers. When US corporations move to foreign countries their production of goods and services for American consumers, they convert US Gross Domestic Product (GDP) into imports. US production declines, US jobs and skill pools are destroyed, and the trade deficit increases. Foreign GDP, employment, and exports rise. "
"US corporations that offshore their production for US markets account for a larger share of the US trade deficit than does the OPEC energy deficit. Half or more of the US trade deficit with China consists of the offshored production of US firms. In 2006, the US trade deficit with China was $233 billion, half of which is $116.5 billion or $10 billion more than the US deficit with OPEC. "
"The other reason for the dollar's demise is the ignorance and nonchalance of "libertarian free market free trade economists" about offshoring and the trade deficit.
There is a great deal to be said in behalf of free markets and free trade. However, for many economists free trade has become an ideology, and they have ceased to think.
Such economists have become insouciant shills for the offshoring interests that fund their research and institutes. Their interests are tied together with those of the offshoring corporations.
Free trade economists have made three massive errors: (1) they confuse labor arbitrage across international borders with free trade when nothing in fact is being traded, (2) they have forgot the two necessary conditions in order for the classic theory of free trade, which rests on the principle of comparative advantage, to be valid, and (3) they are ignorant of the latest work in trade theory, which shows that free trade theory was never correct even when the conditions on which it is based were prevalent."
The entire article at Press TV:
http://www.presstv.ir/detail.aspx?id=35109§ionid=3510304