GUEST COLUMN: "Deceptive 'Made in China' Statistics from the Federal Reserve"
From our mailbag, Bob Hall offers a guest post, “The ‘Made in China’ Content of the Federal Reserve—A Rebuttal”:
You may have noticed that the Fed's "Economic Letter" included in its calculations American consumer spending on services, which the Fed claims accounted for 66.9% of personal consumption expenditures, or PCE. (How comforting that 66.9% of our money, or so the Fed claims, goes to services that do not create wealth. How predictable that the Fed doesn't say this a problem.)
Because Americans buy Chinese products (which creates Chinese wealth), not Chinese services, this trick was clearly designed to manipulate the headlines and, of course, the public. If we accept the Fed's catchy claim that "goods and services from China accounted for only 2.7% of U.S. personal consumption expenditures in 2010," we can at least drop the "and services" baloney and revise their figure from 2.7% to 8.2%.
Good grief, according to the Fed's own report, this is more than twice what Americans spent on motor vehicles (3.4%), more than what we spent on food (8%) and almost half of what we spent on housing (16.6%).
"Made in China" is suddenly more alarming than the Fed wants us to believe.
Related recent Blogs
- A bad time to sideline trade talks • by mmcmullan • 12/04/2013
- Infrastructure investment means job creation • by TGarland • 12/04/2013
- December 4, 2013: Familiar trade deficit doldrums • by mmcmullan • 12/04/2013
- China trade deficit on pace for new record, but will anyone notice? Alliance for American Manufacturing (AAM) Statement. • by scapozzola • 12/04/2013
- What to do with abandoned factories? Bring in the artists! • by LDonia • 12/03/2013
- Surprise, surprise? Americans still say job creation should be top priority • by mmcmullan • 12/03/2013
- Fmr. Transportaion Secretary Ray LaHood urges infrastructure investment • by TGarland • 12/02/2013
- The Computer Wore Heels: Check out "Top Secret Rosies" • by mmcmullan • 12/02/2013
- The Veep heads to Asia, while Michigan Democrats and automakers press the "currency issue" in TPP talks • by TGarland • 11/27/2013
- November 27, 2013: Tension over the East China Sea and more • by LDonia • 11/27/2013