It has become standard faire to blame the United States' trade deficit on low wages in the developing world, and Asian currency manipulation. The argument then goes - the U.S. must find ways to devalue its currency.
But even with a devalued currency, a nation needs something to sell. It means an industrial policy, and government support for industry. This does not happen on a consistent basis in the United States, except in a few sectors. The most obvious sector of American global export dominance, backed by government support, is in military hardware and weaponry.
Germany's success as an exporter is a fairly strong refutation of the devalunista strategy of reviving U.S manufacturing. It's not all about wages; it's also about skill and making quality products. Germany managed to be the world's top exporter (though soon to be replaced by China) despite a steadily strengthening Euro from 2002-2008. In many industries, it is Germany that has the high-end niche brands ; for instance, in the highly visible automotive industry, no American product has the reputation of a BMW or Mercedes Benz.
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1 "Berlin's warning: only exports can save Germany" - The Economist
2 "NYT Gets U.S. Imbalances Wrong" - Dean Baker
3 "On the G-20 Agenda" - Economist's View
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