Summary

Government deficits are accelerating deindustrialization in the United States. Should we care? Absolutely. One reason is that manufacturing and associated learning-by-doing are powerful sources of external benefits that accelerate economy-wide productivity growth. A second is that the loss of manufacturing jobs is a powerful source of anger against free trade. The U.S. federal government needs to run surpluses to eliminate the savings deficiency of the American economy.

Recommended Citation

McKinnon, Ronald I. (2004) "Government Deficits and The Deindustrialization of America," The Economists' Voice: Vol. 1 : Iss. 3, Article 1.
DOI: 10.2202/1553-3832.1029
Available at: http://www.bepress.com/ev/vol1/iss3/art1