What is the United States market worth?

SHOULD ACCESS TO THE UNITED STATES MARKET BE FREE ?

2015 TRADE DEFICIT IN GOODS -$758 BILLION

I have spent most of my life self-employed in some fashion or other and one point is clear, I have never had access to a market for free. Many years ago I did 3-4 flea markets per week. Access costs were $10.00 to $20.00 per table. I also sold in co-op markets where the monthly rent was as much as $300 for 4 weekends. Having a retail business, you have to create your own market, and it has many costs. Costs for selling on Ebay and other sites range from 2.5% to 10% per sale price.

Many people don't know that every food supermarket has a system called "slotting fees" which are the prices charged to all manufacturers and venders for shelf space. This cost can range from $250.00 to $1000.00 per linear foot based on the store volume and projected sales. If sales drop below a threshold, you may lose your space. This applies to every individual location. This is usually a one time charge and you can see that this really can have a large effect on the initial cost of opening a new store. The end caps are an annual fee, usually around $1500.00 per year.

So again back to my initial question. "WHAT IS THE UNITED STATES MARKET WORTH?"   and, "SHOULD ACCESS TO THIS MARKET BE FREE?"

The United States gross domestic product for 2015 was $17.95 trillion; consumer spending was $11.3 trillion. Our trade deficit in goods was -$758 billion. We have run a trade deficit every year since 1975. Take note that we had a trade surplus in services of +$227 billion. This is probably mostly in the banking and financial sector. This may very well explain why this sector has been prospering while the middle and working class has been stagnant or declining. It is great that our financial sector is doing well - could you imagine if our manufacturing sector would be doing this well? It is also notable that our budget deficits and trade deficits are very much aligned.

When the country was founded the federal government was forbidden from engaging in direct taxation. This remained the case until 1913.  The source of federal revenue was tariffs on imported goods. There was some genius on the part of the founders in that if they raised tariffs too high, imports would slow and their income would diminish or some local entrepreneur would fill this void. If tariffs were too low, local business would complain and their income could also suffer. It was a self correcting system where excesses would not be tolerated for long and would restrain federal government spending.

No one is suggesting that the tariff system should be brought back, but the point is the United States is the biggest market in the world.  This market has costs, roads, bridges, electrical power generation, ports, and many small retailers who pay all the costs and of course these costs are passed on to the consumers. When one has a market this large, and most of the world is dependent on having access to this market, the United States is in a very powerful position to negotiate trade accords that would eventually bring our balance of payments in goods to a much more favorable level. This would result in a more fair playing field for out manufacturing sector, which would result in more real jobs that produce wealth for the nation. There is much opposition to changes in trade policy. Of course if you are importing or producing products in the Third World and have access to 1st world markets, it is the deal of a lifetime. Even these people realize that this is a limited window of opportunity and they want to sustain it as long as possible. They know that public sentiment will eventually get this and this has to change either from worker revolt or economic decline.


Originally published 8/2/2016