Letters to the Editor
-
The Sale of America
Reich: As a practical matter, our only real hope for avoiding a deep recession or worse depends on loans and investments from abroad -- some major U.S. financial firms have already gotten key cash infusions from foreign governments buying stakes in them.
Just come out and say it: America is now for sale.
It will start with financials like Citibank, Morgan Stanley, Merrill Lynch, and move all the way through the economic infrastructure of this country, probably finishing with one of our last real areas of innovation and global leadership: the drug companies (if they're still around after the trial lawyers and universal health care dictates get through with them.)
The debt owed by the U.S. across Asia and the Middle East is truly staggering, well into the trillions. What is the world to do with all the dollars we've sent them for plasma televisions, beautiful new cars and the oil to commute from a formerly overpriced home in the Inland Empire to Los Angeles? Is there not enough good Napa cabernet to make up the difference? Why wait for these dollars to fall further in value? I'd be buying up America too.
But it's not even foreign citizens buying us! No - it's government controlled sovereign wealth funds. That's right - these foreign citizens are smart enough to dump detested US dollars back on their governments and exchange them for real currency. This leaves the Abu Dhabi Investment Authority sitting on more than $1.5 million per person! That's some high end shopping to get done!
We have a U.S. government unwilling to admit that the $10T in debt doesn't even begin to account for all the false entitlement promises they made. Would politicians say something just to get elected? That's bad, but what's worse is an electorate so numb and miseducated that they have no chance to ever understand their predicament.
How about a Federal Reserve so keen on keeping up this charade that they are willing to risk collapse of the dollar while creating entirely new powers out of thin air? Although we should be facing a straightforward deflationary recession with the unwinding of all of this bad debt, we've got a government that acts like it's ready to become the next Zimbabwe. Yes - their stock market goes up too! Lending to banks is not pushing out enough money, so the Fed may be ready to broadly lend to IPC's as well. Let's guarantee the bad debt for Countrywide while we're at it! Money for everyone!
The end result of all of these policies is hyperinflation, and a collapse of the US dollar. What better way to get rid of the debt than to simply inflate our way out of it? Then no foreigners will be foreclosing and taking over our assets! We will no longer pass a mountain of debt on to impoverish and enslave our children for their lifetimes. We'll just print it and say: "It's Tuesday, and here's the money for that hamburger!"
If you were a politician, what would you do?