Cold feet

With an economy in recession and a presidential election a few months away, the debate about America’s foreign debt is on the horizon. More difficult than determining how much money the federal government should spend will be the question of how to spend that money. Though they are both expensive, Obama’s plan to make health care more available and McCain’s proposed extension of Bush tax cuts for the wealthiest Americans appeal to two very different segments of the population. \nPutting partisan politics aside, most agree that the rapidly increasing national debt (now totaling more than $9 billion) will at least affect the future of our nation, for better or worse. And if political pundits are at all a reflection of voters’ concerns, we’ll be seeing a fair number of people thinking about the economy at the ballot box. In a recent column, Time magazine’s business and economics columnist Justin Fox bemoaned the decrease in American exports. In a narrative made redundant by a thousand other political speculators, Mr. Fox told how awful it is to see ships coming into American harbors full and leaving empty.\nAt face value, it does seem to be a problem that Americans import far more clothing, televisions and children’s toys from the BRIC countries (Brazil, Russia, India and China) than we export. After all, these purchases are short-term gratifiers and do not continue to generate revenue like investments in technology or industry.\nBut Mr. Fox’s idea of a solution to the national debt seemed more ridiculous than our unchecked consumption. The column details how great it is that Americans are actually refilling containers with products such as wood pulp and shipping these out of the Savannah, Ga., port. When his list of other significant exports, including paper and kaolin clay, ended with “frozen chicken parts,” I was laughing aloud. Even though Mr. Fox notes that frozen chicken feet are much “beloved by Chinese gourmets,” I put less than full confidence in the potential of icy poultry scraps to finance our nation’s consumption.\nThe United States has a GDP more than twice the size of runner-up Japan. Why, then, would Mr. Fox delight more in seeing our shipping patterns resemble those of a developing economy, sending abroad raw natural products and eventually producing simple goods like televisions and T-shirts?\nLike the chickens he wants to export, it seems Mr. Fox has gotten cold feet when faced with this century’s demands. Although it’s tempting to take the exporting of raw goods as a sign of economic progress, if we really hope to get out of the red, it would seem most prudent to continue producing more valuable goods like financial services and software. That’s what America does well. And while you can’t see these things ride a boat back to China, they are nonetheless our lifeblood. Sophisticated services are the marker of developed countries. That’s why we need to continue in this direction of modernization, not more crates of raw goods.