Michael66

The Great Year-End U.S. Jobs Blowout

People just do not comprehend how much harm they do to the American economy when they buy an imported car.

Take, for example, the effect of buying a $50,000 Mercedes here in the US.

Approximately 60% of the list price of the Mercedes or $30,000 is transferred to Germany. That is $30,000 of American capital. The US loses $30,000 of capital and Germany gains $30,000 of capital.

This $30,000 of capital is permanently lost to us. We can no longer use it to invest in America.

In addition to a transfer of capital, that $30,000 transferred to Germany also represents $150,000 of jobs transferred to Germany.

Economists figure that when one dollar is introduced or transferred out of a country it actually represents $5.00 of jobs gained or lost. This is called the “Job Multiplier effect” of capital lost or gained.

Multiply $30,000 by the standard job multiplier of 5 and you have the sum of $150,000 which is the dollar value of jobs that the $50,000 Mercedes sent to Germany and that we here in the US have lost.

In other words, the purchase of the Mercedes lost America the equivalent of three jobs each paying $50,000. Germany gained the equivalent of three jobs each paying $50,000.

Currently we are transferring $6,000,000,000 (six billion dollars) of capital per day out of the US to purchase depreciating and wasting assets. In essence, we are squandering our capital.

This is a disaster in the making.