The US Economy

When we view the quarterly graph, it seems very chaotic without any clue about the cumulative long-term trend. It's really awesome to see both, and realize the ups and downs during the year is a 'natural' dynamic of our economy.

To minimize the threat of another flood of cheap imports, however, the administration said it plans to require steel importers to obtain licenses in advance through a system that would give the Commerce Department prior notice of any surges. Trade lawyers and European Union officials said the license requirement for non-U.S. steel amounted to another illegal restriction on trade.

Mandatory registration of import licenses "isn't as bad as tariffs, but it's clearly a barrier to trade, and against WTO rules," said Francois Renard, a trade lawyer at the law firm Norton Rose in Brussels. Groups representing steel importers have criticized the license program but said in recent days that they would accept it if the tariffs were dropped because the cost of licensing is relatively minor.

Just a little piece of trivia here, for perspective: 18 years ago today, Dec 5, 1985, The Dow broke above $1500 for the first time ever.

A few days ago, when the news leaked out that Bush would scrap the steel tarrifs, I was conflicted. The fair, open minded part of me thought to myself: "Maybe my conservative friends on Able2Know are right: Maybe I ought to give Bush the benefit of the doubt more often, and start right now by assuming he's doing the right thing for a change." At the same time the cynic in me thought: "Okay, that was the bait. Where's the switch?" Today, the conflict has ended: the Wall Street Journal informs us what the switch is: (Subscription required for full article.)

The Wall Street Journal wrote:

To minimize the threat of another flood of cheap imports, however, the administration said it plans to require steel importers to obtain licenses in advance through a system that would give the Commerce Department prior notice of any surges. Trade lawyers and European Union officials said the license requirement for non-U.S. steel amounted to another illegal restriction on trade.

Mandatory registration of import licenses "isn't as bad as tariffs, but it's clearly a barrier to trade, and against WTO rules," said Francois Renard, a trade lawyer at the law firm Norton Rose in Brussels. Groups representing steel importers have criticized the license program but said in recent days that they would accept it if the tariffs were dropped because the cost of licensing is relatively minor.

Oh well ...................

like the wall street jounral article said, it's a fairly minor non-tariff barrier to trade.

i really believe that there needs to be some measures to ensure that we aren't flooded with cheap subsidized steel. it's not fair trade to have to compete with foreign government subsidized products.

It goes on and on, and that's not going to change.

... The Federal budget posted a deficit of $374 billion in fiscal 2003. That was $216 billion more than the deficit in fiscal 2002 and a record dollar-figure high. In relation to the U.S. economy, however, the deficit was a moderate 3.5 percent of GDP, well below the shares of the early 1990s and 1980s, when the deficit as a percent of GDP approached 5 percent and in one year hit 6.0 percent (in fiscal 1983).
Receipts in fiscal 2003 were $1.782 trillion. That was down $71 billion or 3.8 percent compared to the previous fiscal year. Net individual income taxes fell $65 billion (7.5 percent) and net corporate taxes fell $16 billion (12.3 percent). Other receipts such as those from social insurance and retirement rose. The decline in total receipts was the third in a row but less than the 6.9 percent decrease recorded in fiscal 2002. Erosion in the past 3 years primarily reflected economic weakness, although the tax cuts enacted to jump-start growth were also a factor. Receipts fell to16.6 percent as a share of GDP in fiscal 2003 from 17.9 percent in fiscal 2002 and a record high of 20.8 percent in fiscal 2000. The 2003 share was the lowest in 45 years.
Budget outlays in fiscal 2003 were $2.157 trillion, which was $146 billion or 7.2 percent higher than in the previous year. Growth was slower than the 7.9 percent increase recorded in the previous fiscal year, but brought outlays to a 20.1 percent share of GDP from 19.5 percent in the prior year. Outlays for national defense increased $55.6 billion or 16 percent. Other major functions posting large growth in percentage terms were health (including Medicaid), Medicare, and income security (chiefly for unemployment insurance). Net interest payments fell 10.6 percent, reflecting lower interest rates.
Debt held by the public was $3.9 trillion at the end of the fiscal year, up $374 billion from the previous year. The size of the publicly-held debt in relation to the economy was 36.4 percent. That was higher than a recent low of 33.1 percent in fiscal 2001 but less than the more than 40 percent share that prevailed from the late 1980s through the 1990s.

Odd, isn't it, that the opponents of The Current Administration pound on the record dollar-figure deficit totals, ignoring the relative, and imminently more relevant, percentages, yet simultaneously pound on employment percentages while ignoring the fact America has more people employed today than ever in history? No, not really odd. That's spin ... nothing odd there at all.