Trade deficits are net detrimental to their nation's GDP.

Bobo Fett, when browsing through some old threads, I encountered this of your responses. Your response doesn't state, and I don't find where you've ever stated what is the point you claim credit for?

Regarding the point of my trade deficit posts, (unless a nation effectively experiences “full-employment”), annual trade deficits are always economically net detrimental to their nations' economies. Trade deficits greatest harm is to their nation's numbers of jobs.
Thus, of the greatest harm is to our families' dependent upon wages, (which is among, if not the largest of USA's population segments). This is in turn net detrimental to all USA entities sensitive to the financial conditions of wage dependent families. Our federal and our state governments are among those entities. Respectfully, Supposn

Probably because I don't claim credit?

Bobo Fett, (a) I contend it is as simple as, (unless a nation enjoys effectively full-employment, (i.e. all who want to work generally find employment that more fully tax there capabilities and enables them to support themselves and their dependents), (b) due to a nation's annual trade deficit, (i.e. due to a nation's negative balance of international trade), that nations GDP is less than otherwise.

(c) There's more than a casual relationship between nations' GDP and their population's quality of life. Their population's median incomes, (i.e. labor's slices of the pie), have a greater opportunity to be larger, if the nation's GDP, (i.e. If the nation's pie is larger).

If voters ever generally understand how and why annual trade deficits are generally net detrimental to our nation's economy, I would suggest they
refer to Import certifictes – Wikipedia as among the methods to improve our economy.
Respectfully, Supposn

Great, thanks for restating your hypothesis (in a much nore confusing way), but I have no idea why you did so in reply to that post.

Trade defects can cause unemployment to be lower....seems like you just made up the notion that they must destroy jobs.

PointlessWords, I agree with the opinion of most economists, to the extent a nation's currency's purchasing power is reduced, (i.e. inflation), it's generally of some net detriment to the nation's economy; but that loss of value within currency exchange markets induces foreign enterprises to increase their imports from that nation.
You're not suggesting that the USA's economy would net benefit if we arranged for the U.S. dollar's value to be reduced throughout the world's currency exchanges? Respectfully, Supposn

Ecriture d'adulte, to extents a nation doesn't enjoy effectively full employment, an annual trade deficit's net detrimental to their economy.
Regarding USA's annual trade deficits affects upon jobs, I'm in agree with a great many economists who do, or do not believe USA's trade deficits are detrimental to USA's economy. The majority of economists not opposed to our trade deficits, argue that trade deficits are comparatively small relative to USA's annual GDPs. They do not argue that our annual trade deficits are of net benefit to our nation. I believe the detriment to our economy exceeds the deficits' finite numbers of dollars. We cannot estimate what the economic and social impact of less jobs, fewer different types of domestic enterprises that are displaced by cheaper imports.

Even among credible economists not opposed to our nation's annual trade deficits, can you find any that deny those annual trade deficits detrimental affects upon numbers of jobs? Can you find any of those economists contending that USA's annual trade deficits are economically beneficial to our nation?
Lesser jobs affect entities sensitive to the financial well-being of employees and their dependents. Our federal and state governments are among the largest, but they're not the only U.S. entities sensitive to the financial well-being of wage-dependent families.
Respectfully, Supposn

That'ts just not true. I;d rather have a trade deficit if it mwant higher GDP and employment.

Ecriture d'adulte, I would also prefer annual trade deficits if they'd consequentially induce greater annual GDPs and employment for my nation; unfortunately, they induce the contrary. For any given amount of annual national expenditures, trade deficit nation's net balances of trade reduced, and surplus trade nation's increased their GDPs and numbers of jobs more than otherwise.
Regardless if credible economists are proponents, or opposed, or are neutral in regard to this matter of annual trade deficits, excluding inordinate, (i.e. exceptional or unusual) circumstances such as a nation enjoying a duration of effectively full employment, do any of such economists claim otherwise?

I'm an old man. Within my life thus far, it was only during the years of World War two when I recall USA experiencing “effectively full employment”. After the war, USA has never since such experienced that. Respectfully, Supposn

Supposn - Please explain Japan in the 1990s as far as trades surpluses and economic growth.

Or Italy 2013-2018

Ah, I'm glad you got caught up to 15 months ago. Once you get further in the thread later this year, you'll find a couple more posts from only a few months ago clarifying my position. 😃

ok fair enough

re the actual point. it's seems dubious that never running a deficit is optimal for GDP. That's primarily because a factor in GDP is other countries GDPs

Chezlaw, I don't believe your suggestion of trade deficits affect upon their nation's GDP “may be true at a fixed point in time but maybe the GDP curve is higher if it always carries a trade deficit” can be mathematically valid.

USA's GDP is a “snapshot” of our major entities' entire spending, usually expressed increments of current or real, (i.e. unadjusted or adjusted) reflections of the U.S. dollar's purchasing power. However we express it, higher or lower curves on the graphs are not proportionally modified.
I do contend nation's net balances of international trade affect upon their annual GDPs are proportionally understated. It's not possible to entirely determine trade balances affects upon domestic enterprises supporting other domestic producers of products that are or were globally traded.
Those modifications of other domestic enterprises' aggregate net revenues and their increases or declines in numbers due to their nation's international net trade are not entirely reflected within the prices of globally traded products and cannot be estimated. Respectfully, Supposn

It is mathematically valid.

You changed "sometimes" to "always" so maybe you misread

I know little of any other than North America and some of the Western European economies. After I read your post, I searched and read what was described as Japan's economic “lost decade” or time of “stagnation”. I didn't find any speculation relating it to Japan's surplus of trade. Annual trade deficits are net detrimental to their nation's economies; but I never contended their elimination is a panacea for solving all of a nation's economic difficulties?

Coincidentally, last Sunday at one of those too rare family gatherings, I was able to discuss your post with one of my sons. He knew more of what I have previously read.

Similar to the U.S., Japanese government's regulators had driven interest rates down to almost zero, and similar to the USA, Japan's government was supporting financial institutions that were “too big to be permitted to fail”. My son made a point of informing me of a generation of Japanese graduates unable to find meaningful employment. Japanese companies were hiring temporary foreign workers not requiring benefits such as pensions. My son reminded me of all that occurred due to USA's recession caused by the excesses of unregulated trading of particularly lower grade debt derivatives. I was aware of those causes and their consequences. I also suppose USA was and is among Japan's major export markets. Respectfully, Supposn

Chezlaw, I posted USA's GDP is a “snapshot” of our major entities' entire spending, usually expressed increments of current or real, (i.e. unadjusted or adjusted) reflections of the U.S. dollar's purchasing power. However we express it, higher or lower curves on the graphs are not proportionally modified.
Respectfully, Supposn

How could that possibly prove anything much about the curve?

The GDP of other countries matters to the curve. So the dynamics of world trade matter. Maybe no country does best by always having positive trade balance. Could even be that a zero trade balance is optimal over time.

I remember a related discussion coming up years ago. Could a boom and bust cycle achieve overall better results than steady growth?

Economics might benefit from 'forest fires'

Chezlaw, detrimental business cycles are not beneficial to the poorer families that must strive to survive the durations of harder times. Historically, economic purposes were primarily to serve those families that dominated the governing of their societies.
To the extent that politics now require the world's governments' leaders to (at very least pretend) they're serving their populations' needs). All governments at very least pretend to be more democratic.

Changes of our dollar's purchasing power, (inflation or recession of the dollar's value) doesn't in itself consequentially change the comparative proportional shapes of annual GDPs graphed over durations of time. Respectfully, Supposn

I'm not arguing for downturns but the idea there's anyhtign like a proof that they dont help the future just isn't true.

Dynamical systems can get trapped on local peaks if you wont allow going downhill. The pain for poorer people at the time is a very good reason to try to avoid them but that's a very different question.

.

Chezlaw, you're suggesting there may be a net benefit due to nations' business cycles. I'm very much aware of human suffering during the downsides of such cycles, but I haven't encountered any speculations or studies indicating those rollercoaster rides were of net benefit to their nations.

Many people point to the acceleration of technological advancements due to wars. However, few philosophers or economists are publicly advocating for more wars to better improve our economy. You can speculate if that's because they don't want to be thought of as indecent, or if they don't believe seeking wars are good national policies. Respectfully, Supposn

Chezlaw, my toilet works because the water entering it eventually continues to flow down the sewage system. You can conceive of a roller-coaster that only goes up? Respectfully, Supposn

That's a very simple sink. If you're filling a glass of water (which is still very simple) then there's no simple relation between opening the tap and faster filling - you actually have to limit the water flow to even fill the glass.

These are trivial even compared to the forest fire analogy which is itself a trivial illustration of why continual growth might not be optimal.

Sure but there's no advocating going on . I'm totally against war. That doesn't in any way argue as to whether it's possible wars accelerate growth over longer periods of time which they quite possible do. similartly with 'busts'.We can't conclude that busts dont accelerate growth over time just because we dont want busts.