Everyone has an idea on how to jump start the economy. Way back when H. Ross Perot was stirring up the chili, he said that if NAFTA passes, you will hear a great sucking sound. He was speaking of jobs going south because of the cheap labor cost in Mexico; it would become the new manufacturing mecca. A maquiladora is a factory that imports materials and equipment on a duty free-tax free basis for assembly or manufacturing and then re-exports the assembled product. Currently about 1.3 million Mexicans are employed in maquiladoras.

At one time they said that Japan was going to be the ruler of manufacturing. After all the Japanese were buying up everything in sight, including skyscrapers and golf courses in California. Well we know how that turned out. Bodda Bing Badda Boom turned into Badda Bust. Next it was the Asia Tigers, Hong Kong, South Korea, Taiwan and Singapore. These cats are still there but are not growling as much.

This takes us to today's sucking sound, one that is on everybody mind. It is China, yeah we know, they are the bad boy in town; the cause of what ails us. They are the worlds factory, supplying us with all kinds of junk, made possible by slave labor. As the government reaps the harvest of massive trade imbalances, they are able to buy hard assets all over the world. These Chinese are hard at work, figuring what company to buy next. They have accumulated a 2.5 trillion dollar surplus and are in the midst of a massive buying spree before the dollar sinks like a stone. But don't blame China, blame our government, they made it possible for us to be taken over the proverbial barrel. Chinese Checkers anyone?

But, and now we will hit you with the bad news. All that came before us was nothing more than a buildup to the Big Show. The BIGGEST SUCKING SOUND YOU WILL BE HEARING IN THE NEXT 5 YEARS IS THE PENSION BOMB. While you were hard at work, your representatives, all of them, sold your life to the Public Employee Pension Liability Fund. Up till now you have not really noticed anything detrimental to your wallet. This is about to change, public pensions are running a 3 trillion dollar deficit, $27,000 for every family in the United States. And this liability is about to raise its head, as it does, it will be sucking more money from the Tax Payer. And we can tell you this, the tax payer is not in any mood to pay more in taxes. This will cause some kind of conflict. We do not know, at this present  time, what will occur, but we can tell you this, from what we have seen in other countries that faced similar problems, the future does not look good. Be prepared for the worst, but hope for the best.

 


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