[SteveA]

Quote by: Capitalist Pig And that's a curious thing, isn't it? Because there is no such thing as a trade imbalance. This is evident from the very definition of trade; a mutual exchange of value for value. The way trade imbalances are deduced is by focusing on just one side of a transaction. For example, if Country Y exports more to Country X than Country X exports to Country Y, Country Y is said to have a trade deficit, and Country X is said to have a trade surplus. This is stupid because it does not regard the monetary value of what was traded. Another way to invent trade imbalances is by focusing on just the monetary transactions. If Country X pays more for goods imported from Country Y than Country Y spends on goods exported from Country X, a trade imbalance is said to exist. It does not regard what was traded for the money. For anyone interested in more on the myth of trade imbalances, see this article.

Quote by: Apeman81 We buy at the best price, which very often involves foreing manufacture. So be it

I think these quotes sum up my view on trade deficits rather well.

Personally, I dislike using credit and never buy things I can't afford to pay for up front. So I don't feel responsible nor liable for public deficits. (Private debt is a different of course because it's incurred on a voluntary basis) We've already given

Quote by: Sean What forces us to pay these creditors? ...

All investments involve some risk and that includes credit extended to governmental bodies as well. If our government blows a lot of money and goes bankrupt, I assume these 'investors' will be out of luck as well.

the U.S. government won't really go bankrupt but the dollar can drop significantly in value, which is similar but the value comes from those who were holding/saving dollars. During the Vietnam war we had a very large drop in the value of the dollar and it wouldn't be hard to create a long list of failed currencies throughout history.

Quote by: bishop in our economy, higher gdp growth pretty much always coincides with a larger trade deficit - because 2/3 of the economy if fueled by consumption and we import more than we export.

Economies aren't fueled by consumption - consumption is burning the fuel - production is what fuels the economy. Of course you want to produce things that will be utilized though but what really fuels the economy are capital investments and other beneficial forms of savings.

For example, if you look at how any business or household works, it's not really any different than an entire country except for the scale. The overall welfare of a business or home isn't in how much value can be consumed, but how much tangible value is created and maintained/saved/utilized. So eating all the food in the cabinets doesn't make you better off in the end, growing food instead improves the overall situation, so it's production that improves the economy and lowers prices and reduces debts. Increases in production aren't possible when levels of consumption are so high that there's little to spare to invest in long term improvements/capital investments. Savings in itself doesn't power an economy, but investing savings in production does.