In his column today, Robert Samuelson held out the hope that the prospect of large deficits might: "trigger a flight away from the dollar on stock, bond and foreign exchange markets." Of course a lower dollar is the only plausible mechanism for bringing the trade deficit down to a manageable level.
In fact, the large trade deficit requires the sort of economic imbalances that the country has experienced over the last decade. As an accounting identity, a large trade deficit implies low national saving. This means that either we must have very low private savings or very large negative public savings (i.e. budget deficits) or both low private savings and large budget deficits.
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