The economic crisis is deepening and may soon get worse.

Housing is in a free-fall and the American middle class, which have seen 3 million manufacturing jobs lost since 2000 and 2 million of their homes threatened with foreclosure, is taking it on the chin.

And the proposed economic stimulus plan won’t fix the problem- it will only fan the flames of the decline.

The stimulus package shuffling through congress is estimated to increase the national deficit by $100 billion. Currently the national deficit is at an all time high of over $9 trillion and the balance of trade deficit of $765 billion in 2006 continues to expand as Americans buy more and produce less.

The solution we need is not more debt. The solution must create jobs and help reduce towering personal and national deficits; manufacturing is the solution.

Since 2000, an estimated 3 million good paying, good benefit manufacturing jobs have been lost to low-wage foreign nations. The jobs have been replaced domestically by lower-paying service jobs.

As Americans earned less from these replacement jobs, real estate became inflated to a record 38% of household net worth. This inflated real estate bubble has popped- and with it, the false wealth many Americans depended on has vanished.

The often overlooked truth is that manufacturing matters- and the good paying jobs, and the domestic goods produced because of them- help keep our nation, and our citizens out of debt.

Economist Eamonn Fingleton discusses the importance of manufacturing here...

We have long been told that more and more manufacturing jobs are destined to migrate to the Third World. This view was popularized in the 1980s by such authors as John Naisbitt and Kenichi Ohmae, and it continues today to be the subtext of much economic commentary. But not everyone has bought into the program. Take Canon (Research), the Japanese camera and copier company, which has more than doubled its workforce in high-wage Japan in the past two decades. Since 2002 it has added 6,000 Japanese jobs--at the same time it has boosted profits by 156%, to a record $3.1 billion. … A strong manufacturing sector is crucial for any advanced nation that aspires to pay its way in the world. With few exceptions, America's postindustrial businesses are weak exporters. This helps explain why, measured against gross domestic product, America's current-account balance has gone from a surplus of 0.8% in 1965 to a deficit of an estimated 6.3% in 2005. In the same period, manufacturing's share of nonfarm employment went from 23% to less than 12%. America's trade last year, measured as a percentage of GDP, was the worst of any major nation since Italy's in 1924.

Jim Baird is the managing editor at EconomyInCrisis.org. He is a journalist and commentator. Mr. Baird studied in the Honors Politics program at the University of Edinburgh and is a graduate of The Ohio State University where he studied political science and journalism.