George W. Bush is (deliberately) bankrupting America

Excerpted from http://www.commondreams.org/views04/0105-08.htm

How does a nation deal with debts that so greatly outrun its ability to pay? There are basically only five strategies. All are unappealing. Most are calamitous.

The most difficult strategy is, not surprisingly, the honest one: raise taxes and pay your bills. This is what King George III did following the Seven Years War with France in 1763. England had quadrupled its national debt in fighting the War and needed money to pay it off. It turned to the richest people in the realm, the Colonists, and began taxing paper, glass, paint, lead, and, of course, tea. The result, as we know, was the American Revolution.

It was the same strategy-raising taxes on the rich-that Louis XVI attempted in 1789. The French national debt had grown 10 fold under the pharoic opulence of Louis's grandfather, Louis XIV. Louis called the nobility and the clergy together and told them they would have to ante up. They, after all, had been exempted from taxes by Louis XIV in order to buy their complicity in his autocratic reign. Indignant, they refused to pay, precipitating the French Revolution, the most explosive upheaval to established government in the last thousand years.

A second strategy to deal with excessive debts is simply to print money. This is what Weimar Germany did to address the crushing debt imposed by the vengeful Treaty of Versailles. Before it was over the government had inflated the money supply by over a trillion times, leading some to comment that it was a waste of ink to put it onto paper worth so much less than the ink itself. The German middle class, whose assets were held at fixed amounts in government pensions, was destroyed. The collapse gave direct rise to Adolph Hitler.

A third strategy for dealing with onerous national debt is to sell off national assets. This is one of the first strategies the IMF imposes on third world countries that have gotten behind in their payments to western banks. Government-run industries, from telecommunications to water systems, are "privatized" and the country's natural resources are sold off to the highest foreign bidder. This is what Great Britain was forced to do in the aftermath of World War II.

Two world wars in only 30 years had ravaged the British economy and the pound sterling. Facing collapse at home (and revolution abroad), the government surrendered almost all of its colonies, from India and Pakistan to Nigeria, South Africa, Zambia and Zimbabwe. These had been among the greatest wealth-producing properties of modern times, the ones that had made the British Empire what it was. Their loss left Britain a second-rate power with only misty memories of its once imperial greatness.

A fourth strategy for dealing with excessive debt is to just repudiate it. This was used for centuries in the early days of the modern world and was revived two years ago by Argentina which brazenly refused to pay some $110 billion in debts it had accumulated over prior decades. More ominously, it was this strategy that was used by the Bolsheviks after they took power in the Russian Revolution.

The new communist government refused to be bound by the debts of the overthrown Romanovs. But the French had loaned heavily to the Russian government for decades before World War I and now were left in a lurch. A cascading series of defaults from one bank to another caused a liquidity crisis on the continent, ultimately setting off the Great Depression.

Finally, there is plunder. When a nation's debt load becomes so huge it cannot plausibly reassure creditors regarding repayment, it must seek some source of wealth, any source, to keep the borrowed money flowing. This, naked predation, is what kept the Roman Empire alive for the last two hundred years of its existence. It is the strategy adopted by the Spanish Empire-silver and gold from America-and which eventually destroyed the vitality of its own merchant and civil servant classes.

Government economists are not unawares of these imperatives. So, which of the five above strategies has the U.S. adopted to deal with its exploding debt problem?


I think plunder is fairly evident at this stage in the game. But I wonder if we're even looking at 'American Govt' or govt at all.

 

One thing I think Rat may have alluded to here but not really discussed too much is the fact that as the economy gets worse (and worse and worse and worse), the wealthy in this country are getting wealthier. CEOs are making more than ever before. Corporate subsidies, giveaways, and tax breaks are astronomical. And the war in Iraq has produced billions in wealth and predicted wealth for the richest people in society. Further, Bush has shown complete disregard for unions, unemployment, and social programs that benefit poor workers - which also benefits wealthy corporate masters.

What is frightening is that this is all happening as life gets WORSE for everyone else - and we can only expect more of the same, because the wealthy certainly aren't going to start backing policies that take their money and power away.

 

See, it can't keep going like this for much longer. I mean, look at housing costs, for example. It's already outrageous, and if inflation increases, the poor class will certainly grow a lot larger, which would mean that apartment costs would have to be lowered, or else there would be a massive surge of homelessness. It will certainly be interesting to see what happens in the next few years.

 

considering that my children and i are very likely to be included in such a "surge of homelessness" i would much rather not be living in such "interesting times."

 

Only in your mind. In fact, the economy is showing healthy growth and unemployment has fallen after a relatively mild spike.


You give us the same doom-mongering nonsense regardless of where the economy goes. In fact, nothing seems to make you more angry than good news.

 

I'm not sure why but I am sorry. Pressed_Rat, go take an economics course or something man. I'm tired of you fighting the corporation and claiming to be a Libertarian, a fiscal conservative. Honestly I didn't get much farther than the first few sentences of the original post....raise taxes to get us out of debt....good one.....

 

I NEVER ADVOCATED RAISING TAXES!

I said that Bush claimed he would cut the deficit in half, though this is virtually impossible unless taxes were raised, or if spending, such as on the war in Iraq, was cut.

Libertarians do not support corporate corruption. Libertarians do not support corporate control of America, either.

Perhaps you're the one who needs to take some courses.

 

That means nothing, especially in the light of a record deficit with almost an $8.1 trillion debt, and a dollar which has little value abroad. This is why the global market is dumping American currency and gold is at a 17-year high.

The only people saying the economy is doing well is the government and its controlled media, and the corporations. And you believe them. Well, it shows you know NOTHING about how the stock market works.

You're just a sheep who believes everything the corporate media reports.

 

And I never said you did, the thing is that it wouldn't solve anything! Raising taxes gives the government more money, the government is a HUGE drain (or monopoly if you will) on our economy.

Libertarians support business over the damn government, that much is obvious to a blind man reading their views. Your comments around this site against business are horrific; if you are what you claim to be, why the attack on business? Oh and the Libertarians want to abolish all anti-trust legislation do they not? Maybe I'm wrong there.....let me know.



I think you should have a look at this.



Tax Cuts - A Simple Lesson in Economics

Dr. David R Karmerschen (PhD)

This is how the cookie crumbles. Read it carefully.

Let's put tax cuts in terms everyone can understand. Suppose that every day, ten men go out for dinner. The bill for all ten comes to $100. If they paid their bill the way we pay our taxes, it would go something like this:

The first four men (the poorest) would pay nothing
The fifth would pay $1
The sixth would pay $3
The seventh $7
The eighth $12
The ninth $18
The tenth man (the richest) would pay $59.

So, that's what they decided to do. The ten men ate dinner in the restaurant every day and seemed quite happy with the arrangement, until one day, the owner threw them a curve.

"Since you're all such good customers," he said, "I'm going to reduce the cost of your daily meal by $20."

So now dinner for the ten only cost $80. The group still wanted to pay their bill the way we pay our taxes. So the first four men were unaffected. They would still eat for free. But, what about the other six - the paying customers? How could they divvy up the $20 windfall so that everyone would get his "fair share?"

The six men realized that $20 divided by six is $3.33. But if they subtracted that from everybody's share, then the fifth man and the sixth man would each end up being "paid" to eat their meal. So the restaurant owner suggested that it would be fair to reduce each man's bill by roughly the same amount, and he proceeded to work out the amounts each should pay.

And so...
The fifth man, like the first four, now paid nothing (100% savings).
The sixth now paid $2 instead of $3 (33% savings).
The seventh now paid $5 instead of $7 (28% savings).
The eighth now paid $9 instead of $12 (25% savings).
The ninth now paid $14 instead of $18 (22% savings).
The tenth now paid $49 instead $59 (16% savings).

Each of the six was better off than before. And the first four continued to eat for free. But once outside the restaurant, the men began to compare their savings.

"I only got a dollar out of the $20," declared the sixth man. He pointed to the tenth. "But he got $10!"

"Yeah, that's right!" exclaimed the fifth man. "I only saved a dollar, too. It's unfair that he got ten times more than me!"

"That's true!" shouted the seventh man. "Why should he get $10 back when I got only $2? The wealthy get all the breaks!"

"Wait a minute," yelled the first four men in unison. "We didn't get anything at all. The system exploits the poor!"

The nine men surrounded the tenth and beat him up.

The next night the tenth man didn't show up for dinner, so the nine sat down and ate without him. But when it came time to pay the bill, they discovered something important. They didn't have enough money between all of them for even half of the bill!

And that, boys and girls, journalists and college professors, is how our tax system works. The people who pay the highest taxes get the most benefit from a tax reduction. Tax them too much; attack them for being wealthy; and they just may not show up at the table anymore.

There are lots of good restaurants in Europe.


David R. Kamerschen, Ph.D
Distinguished Professor of Economics
536 Brooks Hall
University of Georgia

 

The problem is with big-business and its ties to big-government.

The problem is that big-business owns the two major political parties in this country, and many of the multinational corporations exist above the law. These same countires are also destroying America as they become increasingly intertwined with the corrupt government they feed.

Stop confusing greedy, corporate welfare loving, Republican neocons, like your idol George Bush, to Libertarians. The two are nothing alike.

 

So, lemme get this straight, you love/hate big business right? Or is it hate/love? Business provides us with an economy Pressed_Rat; if we keep regulating it we're going to lose something very important. I think the answer is trimming back the government (and so do those pesky Libertarians). Hey the smaller it gets the more visible it gets, so developing conspiracy theory of the corporate domination of the world probably wouldn't get fully realized.

What I want to know is do you really support growth of business and the confinement of government like those you claim to support, or do you support the growth of government and the confinement of business?

Hey where you from lala land? Down here on earth probably every form of governmental structure to ever exist has had some forms of corruption. If you've got a magic wand I'd like to see it, I say we make the government smaller.

That's a pretty ignorant statement man. And again, please, if you are going to keep claiming Libertarianism, the least you can do is put forth some of the ideas from its' platform (specifically economic issues).

 

Are you suggesting Bush is remotely similar to a Libertarian?
Spending has increased under Bush, military action has increased, our rights and freedoms are disappearing...
Your statement is incredibly ignorant. The LAST thing the Bush administration wants is what a Libertarian wants.
I'm no expert on the libertarian party, but even I know that Libertarians don't vote for dictators.

 

Nope. It seems obvious to me that I was not, but maybe I'm missing something.

And I'm the ignorant one? lol, good one buddy....and who is the Nazi you refer to?

 

The deficit is a measure of the federal government's indebtedness, not a measure of the economy. And the price of gold is definitely not a measure of the US economy. The dollar has plenty of value abroad, try going somewhere, you'll find that you can still buy stuff, just less than before.

Yeah, them and the foreigners, who say pretty much the same thing - just compare the economic performance of the US, Europe, and Japan, as plenty of foreign media and independent analysts do - the US is by far the outperformer. Saying I know nothing about how the stock market works is interesting - seeing as neither I nor you have mentioned anything about the stock market - but for what it's worth the S&P 500 is up for the year and also over the last month - tell me, does a rising stock market typically indicate perceptions of poor economic heath?

No, you're just a contrarian sheep that disagrees with everything you hear because it makes you feel "indy".

 

Yep, it most definitly would, actually, it would eventually eliminate all debt. People are always so happy to blame all this stuff on their government, but the reality is the central banks control everything, even governments. What does a credit card company do when you can't pay the bills and the interest on their non existant money? you become in debt, this is simply what's happening to our governments except on a larger scale. The central banks create debt by loaning out non existant money and asking for interest on it, they even do this to countries governments who need money for war, etc. Once this money is lended, the government is in debt, which means the central banks own the government until they pay them back, and with trillions of dollars of debt, that won't happen very soon. Everybody here should read "And the truth shall set you free" by david icke, it talks about how in the 1800s abraham lincoln created "greenbacks" which was money without debt behind it, this was devastating to the central banks and the house of rothschild, john wilkes booth, who has been known as an agent of the house of rothschild, killed abrahman lincoln, and after that, the production of greenbacks ceized...makes you think...

Peace and Love,
dan