Baltimore Business Daily

How does increasing exports lead to reduced unemployment and increased economic growth?

Obama wants to double exports within the next 5 years to create jobs and economic growth. How does this work? Also, how does it make firms more competitive and what are the implications of this?

Public Comments

1. exports are stuff we make and sell abroad. making them requires workers, hence reduced unemployment. Selling them brings in money, hence growth. firms become more competitive b/c of better technology or better workers (education, skill, working habits)
2. Actually I asked this question a little rhetorically a while back, because its impossible to double exports. In 2008, the value of exports as a pct of GDP were 12.6%. This is the greatest amount as a % of GDP going back to 1960. Barack expects to do something to double that by 2015. Not only would this rate of gain be unprecedented, it would be impossible except for two outcomes which no one wants. You can play the math game and issue so much currency that you nominalize the debt and halve the value of the Dollar thus doubling the nominal value of exports. The other option is to shrink the GDP which I shudder to think about. The projections of the State of the Union address were total blather for any economist to watch. I had to turn it off in order not to destroy my TV with my remote.