willbeurdaddy -> RE: a challenge for republicans (1/20/2011 2:24:54 PM)
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ORIGINAL: Musicmystery Incidentally, [and no, I'm not denying there's a trade deficit, folks--clearly there IS] This is an interesting NPR piece (I've linked to the transcript page, where you can also hear the audio if you choose) about the iPhone and the U.S./China trade gap. Because imported goods are evaluated at full value, the iPhone accounts for about $2 billion of that trade deficit (that figure is disputed, but the point remains). However, the parts of the iPhone all come from U.S. companies, manufacturer on U.S. soil--the phone is merely assembled in China, a small part of it's value. Presumably, the iPhone is just one example. Tracing the Trade Deficit Back to the iPhone Im not sure of the point this is trying to make. Yes, the full value of the iPhone increases the import side of the trade deficit, but the parts that are sold to be assembled increase the export side. The net effect on the balance of trade is the value added by the Chinese assembly process and the transportation costs.
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