The U.S. merchandise trade deficit hit $450 billion, almost 5% of the U.S. economy.

Our trade deficit in manufactured goods, $324 billion, is now 22 times as large of our trade surplus in agricultural goods.

Imported manufactures now equal 62% of U.S. manufactures.

Manufacturing jobs, 30% of U.S. jobs in 1953, are now 13%.

America's biggest trade deficit, $84 billion, is with China. We buy about 40% of China's exports; China buys 2% of ours.

Not long ago, such trade deficits would have stunned U.S. statesmen. No more. To acolytes of the Global Economy, "Trade deficits do not matter." An article in the May/June Foreign Affairs ("The U.S. Trade Deficit: A Dangerous Obsession") instructs us: We must not let these huge deficits frighten us.

Well, as Wellington said of the recruits sent over to Waterloo, they may not frighten Napoleon, but by heavens, they frighten me! What do these deficits mean to America?

A dangerous, deepening dependency on foreign nations for the vital necessities of our national life. America imported $89 billion in crude oil last year, half of all the oil we consumed. Oil dependency sucked us into war with Iraq, has forced us to give war guarantees to non-viable states in the Gulf, and is dragging the U.S. into the snake pit of Caspian Basin and Central Asian power politics.

Have we forgotten? Hamilton created the "American System" to end our reliance on England and Europe, because he and Washington believed economic independence was necessary for political independence. If we did not depend on Europe, they knew, we could stay out of Europe's wars. Is all that Made-in-China junk at the mall worth the loss of our economic independence?

A second cost of free trade is deindustrialization. When Spain, Holland and Great Britain lost primacy in manufacturing, to focus on trade and finance, their great days were over. Manufacturing is the muscle of a nation, the key to its productivity and wage growth. What benefit do we get from a $105 billion trade deficit in autos and trucks, a $48 billion trade deficit in clothing, and a $43 billion trade deficit in office machines and ADP equipment, all of which we used to make here?

Why take these high-paying jobs, the yellow brick road to the middle class for working Americans, and send them abroad?

A third cost of free trade is the corruption of conservatism and the mass conversion of American capitalists into the pimps of hostile powers. Since 1990, China has amassed $400 billion in trade surpluses with the U.S. That cash hoard has financed the largest military buildup in Asia since Japan in the '30s. Beijing had used it to buy Russian destroyers, subs and Sunburn anti-ship missiles and Lavi fighters and Python air-to-air missiles from Israel. What is this Chinese arsenal for? To fight and kill the U.S. Pacific fleet.

American companies and consumers are giving China the dollars to put Shane Osborn and his crew at risk of their lives in the Taiwan Strait and South China Sea. The Clintonites are not the only ones corrupted by soft money. Conservatives who celebrated the Reagan "strategy of denial" toward Moscow now tell us that feeding the Asian tiger will domesticate it.

But when does that occur? Before, or after, Beijing has targeted 600 missiles on Taiwan and U.S. bases in Japan and Korea?

Love of money is the root of all evil, said St. Paul. To acolytes of our new religion of Economism, love of money is the way to convert the barbarian to democracy.

Do not Americans see what is happening to their country? As our dependency grows, our bonds of unity dissolve. "Buy American!" is now stupid; buying cheapest is smart. Trade deficits have given Asians and Europeans the dollars to buy 10% of our stocks, 20% of corporate bonds, nearly 40% of our public debt. Our current account deficit is 4.4% of GDP, an unheard of figure that portends a collapse of the dollar after we have been denuded of our factories.

Finally, there is the loss of sovereignty. As the European socialist superstate, the EU, demonstrates, every free trade zone calls into being a regime to enforce its rules. Global free trade leads to global government. Clinton understood this. Conservatives do not. They will wake up one day to find out that free trade is not free.

— from Economic Reform, May, 2001

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