Trade deficit is also a red herring. It's accompanied by an equal and opposite capital account surplus. In this case China invests in US Treasuries. Now this is

Trade deficit is also a red herring. It's accompanied by an equal and opposite capital account surplus. In this case China invests in US Treasuries. Now this is money you could be spending wisely -- funding obligations and social services, investing in education, investing in infrastructure, investing in new technology. The rhetorical question is what has the US been spending it on? It's crystal clear what the problem is. It's not the trade deficit, which is simply a result of the market's way of allocating where capital and labor should be. The market is giving US laborers an extraordinary break -- let others be slaves, you take the capital. The problem is what the US has been doing with this capital.