Why GDP (Gross Domestic Product) Is A Misleading Representation Of America's Output Of Goods And Services

GDP or Gross Domestic Product, a widely relied upon economic statistic, measures spending, not production. GDP = private consumption + gross investment + government spending + (exports − imports).

If we break down the components of that equation, we can see that the GDP of the United States is primarily driven by defecit spending, consumer borrowing.  The final output is hindered however by a massive trade deficit.   The trade deficit is represented by the last portion of the equation (exports - imports).  Exports minus Imports is certainly a negative number in the United States in 2011.  Because (exports - imports) is always a negative number, to generate a postive GDP America has to perpetually expand defecit spending and the issue of credit. 

America's ability to export has been weakend by outsourcing of labor to markets.  Specifically markets where the currency is artificially supressed in order to compete with other exporting nations for the demand of USA consumers.  Obvious examples of suppressed labor markets would be China and India.  Our ability to import is strong due to the artificial overvaluation of the US Dollar.  The overvaluation of the dollar is protected at all costs by the United States military industrial complex.  Our leaders know that we as a nation of consumers cannot afford a lower global demand for dollars as this would almost certainly collapse the American standard of living that we all have become accustomed to.

Media reports will tell the general public that GDP was up x percent this year when common sense would tell us that with unemployment being as high as it is, there's no way the USA's actual productive capacity is increasing. The reason GDP has been positive in the last few years is simple.  Deficit spending, credit expansion, and money printing.  We are producing less goods and services each year and compensating for this loss with the printing press.