The US now has fewer manufacturing jobs than it had in 1950 when the population was half the current size.

January 22, 2008 | Neither Supply-Side Theory Nor Keynesian Remedies Can Save Us Now | Farewell to Old Economic Nostrums | By PAUL CRAIG ROBERTS
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The Bush administration is turning to tax rebates, because problems in the financial system and the amount of consumer debt hinder the Federal Reserve's ability to pump money to consumers through the banking system. Like an easy credit, low interest rate policy, the purpose of a tax rebate is to put money in consumers' hands in order to boost consumer demand.

Will consumers spend the rebate, or will they use it to pay down their debts? If they spend the rebate on consumer goods, will it provide much boost to the economy?

Many Americans are overloaded with debt and will have to use the rebate to pay down credit card debt. The gift of $800 per means-tested taxpayer is really just a partial bailout of heavily indebted consumers and credit card companies.

The percentage of the rebate that survives debt reduction will be further drained of effect by Americans' dependency on imports. According to reports, 70% of the goods on Wal-Mart shelves are made in China. During 2006, Americans spent $1,861,380,000,000 on imported goods, that is, 23% of total personal consumption expenditures were spent on imports (including offshored goods).

Americans worry about their dependency on imported energy, but the $145,368,000,000 paid to OPEC in 2006 is a small part of the total import bill. Americans imported $602,539,000,000 in industrial supplies and materials; $418,271,000,000 in capital goods; $256,660,000,000 in automotive vehicles, parts and engines; $423,973,000,000 in manufactured consumer goods; and $74,937,000,000 in foods, feeds and beverages.
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Today Americans are losing jobs for reasons that have nothing to do with recession. They are losing their jobs to offshoring and to foreigners brought in on work visas. Today many American brands are produced offshore in whole or part with foreign labor and imported to the US for sale in the American market. In 2007, prior to the onset of the 2008 recession, 217,000 manufacturing jobs were lost. The US now has fewer manufacturing jobs than it had in 1950 when the population was half the current size. ...