In a nutshell, the deficit has caused Mississippi to lose a significant portion of decent-paying factory jobs to Mexico and parts further east. Because our government has adopted policies that keep the dollar expensive on the currency exchange market, it is more profitable for industrialists to build factories in China, Thailand and Indonesia and ship the good back to the U.S. that to employ Americans and pay them union wages.

Thomas Paley has a new article on his web site, Why the Trade Deficit Matters. For non-experts on economics, this is a good explanation on how a large, persistent trade deficit can harm an economy. During Reagan's administration the dollar was kept very high and the unhappy result was the "Rust Belt" throughout the northeast and middle west. Factory after factory closed down and moved overseas to compete with other companies that had already made the move. Profits went way up and wages went way down. It was a disaster for those areas.

That same policy is hollowing out the rest of our industrial base. It makes for big profits along with the impoverishment of the non-elite. Read the article. Paley's language lacks the intensity of a crusader, but his message is no less serious.