Economist calls stimulus temporary relief

COLLEGE PARK, Md., Aug. 10 (UPI) -- University of Maryland economist Peter Morici said the Great Recession will return once stimulus money from the American Recovery and Reinvestment Act is spent.

The reason, he said, is the size of the U.S. trade deficit.

The deficit is currently 2.2 percent of gross domestic product, he said. At that size, "the trade deficit subtracts about more from demand for U.S.-made goods and services than President Obama's stimulus package adds," said Morici, a former chief economist of the U.S. International Trade Commission.

The deficit, created largely by importing goods from China and oil from the Middle East, must be paid for in exports or it will continue to shrink the U.S. manufacturing sector, he said.

In addition, with CO2 emissions unregulated in China, "President Obama's energy policies will finish what Chinese and Japanese mercantilists started -- the wholesale destruction of U.S. manufacturing and the middle-class wages it supports," he said.

U.S. manufacturing has lost 5.5 million jobs since 2000. In addition, "the trade deficit is the single most important reason why the private sector has failed to add a single job since 1999," he said.