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Here's what Trump gets wrong

In many ways, Donald Trump's political talking points are Orwellian at best. His constant insistence that the U.S. is not "winning" is being repeated with such pneumatic regularity that voters believe it. Or if they don't yet, they may soon.

Whether we are getting killed on trade or being flooded with illegal immigrants, Donald Trump has been making arguments that were, in part, true thirty years ago, but most certainly not today.



Republican presidential candidate Donald Trump
Paul J. Richards | AFP | Getty Images
Republican presidential candidate Donald Trump

The "INGSOC" slogans in Orwell's epic dystopian novel, "1984":

  • "War is Peace"
  • "Freedom is Slavery"
  • "Ignorance is Strength"

Would fit nicely among Trump's litany of incongruous phrases:

  • "The U.S. Doesn't Win Anymore."
  • "China and Japan are killing us on trade."
  • "Illegal Immigrants are pouring over the border."

Trump's "truths" are easy to debunk.

For starters, the U.S has the largest economy in the world, 50 percent bigger than China's in nominal terms, roughly equal to that of a combined Europe and considerably larger than Japan's.

U.S. per capita income is roughly $50,000, or 10 times that of China, while our debt-to-GDP ratio is considerably smaller than those of China, Japan and many other developed nations.

The above are a few fun facts you'll never hear from Donald Trump.

As for his claims about trade and immigration, very few, if any, are true. The U.S. has been a big winner on trade in recent years, contrary to one of Trump's major claims.

U.S. exports have hovered near record levels, a fact that few bother to point out to Mr. Trump.

True, the stronger dollar has cut into U.S. exports, but that is a function of stronger growth and higher interest rates in the U.S., as the Federal Reserve normalizes policy while 23 other countries are cutting rates further.

Higher yielding dollar-denominated securities are drawing capital out of low-rate countries and into the dollar, pushing its value up, as other currencies decline in value.

But that is a subtlety lost on Trump and his supporters. Neither China, nor Japan, have been aggressively devaluing their currencies in recent years.

The yen was at its weakest point against the U.S. dollar back in 1985, when it took over 330 yen to buy a dollar. It takes about 113 yen to buy a dollar today.

As for overall trade, which by the way, represents 23 percent of economic activity in the U.S., America's position is getting stronger every day.

It is true that we run trade deficits with several other countries, but as a percentage of GDP, the U.S. current account deficit with other nations, the broadest measure of trade, is at its lowest levels in decades, only 2.2 percent of GDP.

The U.S. auto industry has completely recovered from the financial crisis and Great Recession, a record 17.5 million cars sold by global auto-makers at home in 2015, despite claims to the contrary.

The U.S. is among the largest exporters of agricultural goods in the world. We have trade surpluses when it comes to service businesses and intellectual property.

With the advent of both crude oil and natural gas being exported around the world, the U.S. trade deficit could quickly turn to surplus, negating Mr. Trump's trade argument altogether.

Further, China and Japan are either close to, or persistently in, recession. They are NOT outperforming the U.S. economically, in any way, shape or form. Their growth is contracting while U.S. growth continues to expand.

China's shadow banking system is insolvent. There are as many as 65 million unoccupied homes in China, while ghost towns and ghost movie theaters dominate the landscape.

China is more mirage than miracle these days, while Japan's expected global economic dominance is a relic of the 1980s and not a current threat.

On immigration, more illegal immigrants, Mexicans to be specific, have departed the country in the last five years than have entered. The greatest numbers of new immigrants are Asian and Indian, not Hispanic.

Vast numbers of studies have shown that there is a net positive impact on the U.S. economy when immigrants enter the U.S., whether they come legally, or illegally.

Regional Federal Reserve studies, particularly undertaken by those closest to the border, have pointed out that illegal immigrants do not drive down American wages. Illegal immigrants actually contribute over $7 billion per year to social security revenues, none of which they will ever recoup.

Nearly every one of Donald Trump's economic claims can be refuted with verifiable facts and readily available studies, on trade, immigration, alleged currency manipulation and whether or not we are "winning."

The U.S. is also winning militarily, but that's a separate argument. Suffice to say the U.S. spends more on defense than the next 8 countries combined.

Can those dollars be better and more effectively spent? Sure. But no military on earth is as strong as our own.

In many ways, the U.S. stands alone as a veritable fortress of economic and military strength in both absolute, and relative, terms.

Our banks are among the best capitalized in the world. Our corporations are among the strongest. We are the most technologically innovative country on the planet. Our financial markets are among the most stable while our currency is appropriately priced in foreign exchange markets.

If only more of us would fight to have these truths heard over Donald Trump's constant stream of "doublespeak".

Somewhere in Dystopia, Big Brother has found his apprentice.

Commentary by Ron Insana, a CNBC and MSNBC contributor and the author of four books on Wall Street. Follow him on Twitter @rinsana.

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