Think the Nation's Debt Doesn't Affect You? Think Again

http://www.alternet.org/story/49418/

Think the Nation's Debt Doesn't Affect You? Think Again

By John F. Ince, AlterNet. Posted March 20, 2007.

In addition to borrowing from the world's poorest countries, Bush & Co. are secretly confiscating your hard-earned dollars to support their out-of-control spending habits.


Sometime in the next year, Congress will start going through their periodic rituals and related public relations charades in an effort to absolve themselves of any blame for raising of the federal government's debt ceiling.

With Bush and cronies having added over $3 trillion dollars to the national debt, the country's credit card tab now stands at $8.8 trillion. This represents an astounding increase of over 45 percent since Bush came into office in January of 2001. And all this fiscal profligacy took place during the years when the CBO originally forecasted record surpluses of approximately $2.5 trillion. And there is no end in sight to the deficits.

More alarmingly we now rely on foreigners to finance over 40 percent of this debt with the lion's share coming from the Asian central banks. In FY 2006 the current account trade deficit is on track to set yet another record, on the order of $700 billion. To put this in perspective, billionaire investor Warren Buffet points out that, "15 years ago, the U.S. had no trade deficit with China. Now, it's 200 billion dollars." He says if the country does not change course, the rest of the world could end up owning 15 trillion-dollars worth of the United States. That's equal to the value of all American stock.

Is it a natural state of affairs for the world's richest nation to be borrowing from the world's poorest nations, to the tune of over 6 percent of its GDP? Harvard Economic Professor and former Chief Economist at the International Monetary Fund, Kenneth Rogoff doesn't think so. Rogoff goes on camera in the recently released documentary film, TIME-BOMB: America's Debt Crises, Causes, Consequences and Solutions and says, "This is not a normal state of affairs. And it's certainly not something we expect to see from the world's richest country. Back when Britain was on top they were lending money to the world, but we're borrowing from the rest of the world. Our current account trade deficit is now more than our defense spending and incredibly we've been borrowing from the rest of the world like this for several years now. I think we're going to reach a point where the rest of the world decides that they don't want to lend to us. And that can be kind of traumatic."

America's high deficit strategy is due for a critical review, but the review won't be coming from Congress, the media or the American electorate, because these issues just don't rank high on a national agenda dominated by war, sports, celebrity worship, and scandal. But like it or not, Bush's deficit strategy will be getting critical review from the people who matter most: global investors.

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country. My dream (less than 3 years away) has been to retire to Ireland. But if the dollar continues it's drop against the Euro, it will be impossible.

Check this out! Escape From America magazine:

http://www.escapeartist.com/efam/89/efam89.html

it's only a matter of time till the rest of the world pulls the plug and sends us crashing to the depths. bush crime family voodoo economics at its best.

i.e., a large part of that debt now reposes in the wealth of a precious few and they are mostly 'puke patrons.