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An Original DocumentThe Worlds Largest Economy

  Understanding the lessons your life is teaching you.  

  Economics Homepage

  Thinking V Reality

  Created by Us

  The USA

  Adopting New Ideas

  Economic Failure

  Driving Change


  Primary Industries

  Self Organisation

  Debt is a Weapon

  Economic Freedoms

  Steady State Economics

We can see very clearly in the USA the failure of the political process to take heed of economic fundamentals. 

Because the USA is such a major economy, when the USA ignores economic fundamentals that creates problems for all the countries the USA trades with.  Since my country has no direct influence over USA's economic decisions, we have to simply accept as given, whatever the current situation is. 

In particular, the USA refuses to live within a balanced budget.  This means the value of the $US is constantly falling.  That causes inflation in the USA, but some of that inflation is exported and I pay the cost.  Besides the USA chooses to subsidise many of it's own industries, while actively campaigning against the payment to subsidies to producers in other countries.  That distorts the market against non-US producers.  Once again I pay, but so do consumers in the USA. 

In the worst case situation, the USA uses the threat of economic, political or military power to get it's own way.  Politicians all around the world tend to fall over themselves to keep "on side" with American politicians, and that works in favour of the USA. 

Generally the USA works very hard to make sure other countries are bound by rules it chooses to ignore itself.  Economists know that in the long run this is a losing strategy, but in politics the long run doesn't count, the next election does.

USA - No Limits
Everybody with his own truck.