Trade Policy

The U.S., the world's largest debtor, met this week with the confident leaders of its largest creditor, the communist government of China. President Obama, exercising his remarkable gift for presenting a sea change as a gentle current, laid out the fundamental challenge almost in passing: The U.S. cannot go back to the old economy where we borrowed $2 billion a day, largely from the Chinese, to be the consumer of the world by living far beyond our means. We must consume less, produce more, sell more abroad and balance our trade.

If the U.S. wants new energy to be the centerpiece of a new economy in which -- in the president's words, the U.S. "consumes less and produces more," then it will have to have an industrial strategy. Getting there won't be easy. Just as the insurance companies impede sensible reforms in health care, and big oil and coal block vital changes in energy, and Wall Street guts vital reform of finance, global corporations and banks will spend a lot of money to defend the unsustainable trade policies of the old economy.

The trouble with the economy is the economists who advise, oversee and, in some cases, even manipulate it. Their loyalties are more to their institutions and less to our nation.