Reason #45: Outsourced and Overspent

If our leaders in Washington wanted to, they could easily play the same games Beijing is playing. They could slap matching tariffs on Chinese goods. They could force China to float their currency on the world market, like every other industrialized nation must do. But that would cut into the profits of those thousands of U.S. companies that now rely on cheap Chinese costs.

Our national savings rate is less than zero. Meanwhile, Chinese workers are saving 30 percent of everything they earn.

Our leaders also know that if they forced China to compete in a truly free market, places like Wal-Mart would suddenly have empty shelves. And unfortunately, our whole economy now relies on those cheap goods. Without consumer access to so many low-priced items at Wal-Mart and elsewhere, American consumers would stop spending so much money.

That’s a very sick cycle. And all that spending has sent most Americans into huge debt. These days, our national savings rate is less than zero. Meanwhile, Chinese workers are saving 30 percent of everything they earn. That’s another way China is beating the pants off us at our own game of capitalism.

NEXT: Reason #46: The Widening Trade Deficit