The point of all this is that it is very unlikely that the present economic depression will make a full recovery. In fact, it is more likely that given the paltry domestic manufacturing sector, the economy will continue to decline much further in the following two years.  The continued decline will not be due solely to the policies of the present administration, but rather it will be due to the policies of the previous administrations over the past 50 year.

Domestic corporations were run out of the country due to onerous government regulations, unions, and high corporate taxes.  Production in China or India not only provides lower labor costs, but provides a more unregulated business environment, lower taxes, and a welcoming government.

China no longer only produces toys. China now is the world’s largest exporter of technology, commodities, components, and since 2004 China has lead the US in high tech exports, and currently far exceeds the US in new product development.  A recent study by Georgia Institute of Technology found that the US does not even hold the second place in global technology if one considers the EU as a whole, those 27 countries have a greater output and capability. China is expected to overtake the US as the world’s largest recipient of corporate investment within the next 5 years. According to the KPMG [a global network of professional services firms providing Audit, Tax and Advisory services] China will become the most influential country in IT and telecom, industrial products and mining. The Pentagon for some time now has been expressing its concern that the shift to China in the supply chain and for research and development is dangerous. Finding domestic produces to replace warn out parts is no longer possible. Sensitive computer controlled aircraft are vulnerable as the modern “Trojan Horse”.  It is entirely possible at this point for our enemies to secrete a code in the technology they provide that can bring down an aircraft without detection. IBM which was a “trusted” source has moved its production facility Semiconductor Manufacturing International Corp. to Shanghai, China.

Unfair trade practices by China are being allowed to exist because the Federal Government. China’s entry into the World Trade Organization [WTO] was to usher in a new and kinder Communist government. Instead China continues its human rights violations, and its tax structure is designed to lure domestic corporation away from the US. China rebates Value Added Tax’s [VAT]  to exporters, while the US taxes businesses out of existence.  The VAT tax is also collected on imports from the US and that money is used to finance China’s government healthcare coverage. Those rebates are considered illegal according to the WTO, but the Bush administration has sided with China on every appeal brought by US businesses.  The Trade Act of 1974, Section 421 special China Safeguard Investigations provision was the bases for many appeals to the international court. US companies were seeking a remedy which the court granted, but those decisions must be approved by the American President. Since Bush consistently sided with China on the grounds that lower prices were a benefit to the consumer, companies knowing that their appeals would be fruitless, moved their manufacturing facilities to China.