Economics: Trade (and Trade Deficits) <> Wealth Transfer

The otherwise excellent Pickens Plan contains one notable misstatement:

"At current oil prices, we will send $700 billion dollars out of the country this year alone — that's four times the annual cost of the Iraq war.

"Projected over the next 10 years the cost will be $10 trillion — it will be the greatest transfer of wealth in the history of mankind."

Pickens Plan, The Plan (emphasis mine)

The local blogger FreeMarket has picked up on this in his Pay us like you owe us piece - this is simply commodity trade, not wealth transfer.  It might best be argued that a) trading dollars for oil unduly affects our balance of trade, and b) we might find better things to trade our dollars for...