Global Scapegoats

October 1977
National Review;10/14/1977, Vol. 29 Issue 40, p1161
The article comments on the practice of countries to blame their trade deficits on other countries. Since 1974, most European and other developing countries have been running chronic balance of payments deficits which means that more money has been going out, for goods, services and investments, than has been coming back in. The gap has been filled by foreign borrowing, which is getting out of hand. Germany, Japan and the oil producers have payments surpluses. Since one country's surplus must be another's deficit, the outnumbered surplus countries have been taking the blame. The views of the U.S. and the International Monetary Fund are that Germany and Japan should use fiscal and monetary gimmicks to reflate their economies and to raise export prices.


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