America emerged from the Second World War the single most powerful industrialized nation in the world.
Europe’s industrial base was wiped out as Hitler’s government went down to defeat at the hands of the free world. Japan found its industrial base totally destroyed by war’s end.
America, having expanded its industrial ability to accommodate the need to manufacture tanks, planes, ships and every other conceivable military item, found it had the capacity to make and sell consumer goods around the world with virtually no competition.
But America was smart. We knew that in a short time other nations would rebuild their factories, newer and better than ours, which were depreciated by around the clock pressure to grind out the goods of war. America was aware of the fact that it must build and strengthen its political and commercial relations with the governments and consumers of the world, making them fully aware of the vast variety of goods available with the “Made in America” label.
We accomplished this by giving away multi-millions of dollars to nations in need. In exchange we developed markets for our American-made goods. We manufactured shoes, refrigerators, cars, telephones, clothing and every other item a consumer could use. We bought the world market and very successfully.
We “loaned” money to governments by the multi-millions — almost none of which was ever repaid. I would guess that if every nation repaid with interest the money it borrowed from America following WW II, we wouldn’t have a national debt. But that didn’t happen and it will not happen. Nations developing their industrial base with cheap labor soon found that they could undersell America and take away our international consumer market that purchased our manufactured goods.
Slowly, almost unaware in the beginning, manufacturers in America started to look outside our county for lower cost labor. We needed cheaper labor or we could not compete, first with Japanese-made products, then China and the rest of the world. But something is wrong. America, so used to giving away money, remains the rich uncle, supporting nations that in reality no longer need our money. In fact, we need their money to buy our federal government’s Treasury bonds to sustain our spending habits.
Israel, our ally, is an excellent example. America currently is giving Israel $2.5 billion a year for military and economic development plus $3 billion in grants. Israel, a nation that is more industrialized than America is selling its goods in competition with our country.
True, there is a demanding geopolitical side to our gifts to Israel but it started out as a boost to get their nation going. I could name a dozen other nations that receive multi-millions of dollars from America and who are in direct and often-subsidized competition with our country.
It is time we realize that no nation is going to say “thanks, but no thanks. We don’t need your money anymore. As a matter of fact we could probably pay back some of the money you gave us over the years.” That isn’t going to happen either. It is time we start keeping the majority of our dollars at home. America, in 2009, doled out $39.5 billion to other nations in an effort, regardless of what any Washington administration says, to maintain our friendships around the world. Those billions redirected internally would go a long way inputting our nation back in the black.
Let’s start rethinking the entire process before America runs out of cash and credit. We appreciate your opinions on this column whether in agreement or disagreement.
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