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National Debt Makes U.S. Vulnerable; Lender Nations Could Wage 'Financial Warfare'
JSOnline ^ | June 29, 2008 | John Schmid

Posted on 06/30/2008 6:06:46 AM PDT by Diana in Wisconsin

Tax rates could double. Spending on education, research, health and even Social Security could be squeezed tighter than ever. And foreign governments could use powerful financial leverage, rather than military force, to impose their economic and political agendas on the United States.

All because the U.S. national debt - which is being financed on a daily basis by the governments of China and a host of oil-exporting states, among others - has made this country far more vulnerable than its elected leaders let on, says David Walker, who recently finished a 10-year stint as U.S. comptroller general and head of the Government Accountability Office.

The nation's former auditor-in-chief will outline this crisis scenario today in Milwaukee, when he and an entourage of like-minded Washington policy analysts make their latest stop on Walker's Fiscal Wake-Up Tour.

Foreign governments and investors now hold fully half of the United States' total outstanding debt, making Washington susceptible to a new form of geopolitical conflict that Walker calls "financial warfare."

"I'm sure that people during the Roman Empire never thought that that Rome would fall," Walker said in an interview last week.

The tour began over two years ago and has visited 40 cities so far. The idea is to stoke change at the grass-roots level because, Walker said, elected leaders have been unwilling to address America's impulse to live beyond its means. Tour participants say they are acting in the spirit of Paul Revere.

"I believe we will wake up and make tough choices," Walker said. "The question is when. Will it be before, or after, a crisis?"

Walker and his group span a wide ideological spectrum. Appearing with him in Milwaukee are:

• Stuart Butler, vice president of the conservative Heritage Foundation, which has close ties to the Bush Administration.

• Alice Rivlin, former director of the Office of Management and Budget under President Clinton and now with the center-left Brookings Institution.

• Robert Bixby, director of the centrist Concord Coalition, which focuses solely on national budget policy. Its board includes former Federal Reserve chairman Paul Volcker, former Clinton Treasury Secretary Robert Rubin, and former senators Sam Nunn, a Democrat, and Warren Rudman, a Republican.

Since March, Walker has been working as founding president and chief executive of the Peter G. Peterson Foundation. Peterson, a billionaire co-founder of the Blackstone Group private equity firm and commerce secretary under Richard Nixon, launched the foundation to lead a fiscal reform movement.

In congressional testimony last week, Peterson called the nation's borrow-and-spend practices "undeniable, unsustainable and yet politically untouchable." He said if policies remain unchanged, federal commitments including debt service over the next 75 years will total $53 trillion - which comes to $175,000 for every man, woman and child in the U.S. today.

"A lot of politicians know we have this problem and don't do anything about it," Bixby said. "What gets us on the road is a shared concern that we're dumping a huge - and some argue an immoral - burden on future generations. The immoral part is that we know we're doing it and we don't care."

Shadowing candidates

As the 2008 presidential campaign began, Walker's tour began shadowing the primaries. Stops have included New Hampshire, Ohio, Michigan, Iowa and a February visit to Madison.

Bixby follows the spending and tax pledges of both party's candidates. Without quibbling about what he calls the questionable budget math of John McCain and Barack Obama, Bixby arrives at a different point: Even if either candidate is able to finance his campaign pledges in a budget-neutral way, the nation's fiscal imbalances will continue to worsen.

"We cannot afford the fiscal policy that we already have," Bixby said.

Even before the baby boomer generation has begun to retire, Social Security, Medicare and Medicaid constitute 42% of the federal budget, he said. In the next 30 years, the share of population that's older than 65 will hit 20%, from 13% currently, which commensurately inflates the cost of those programs. At the same time, inflation in health care costs far outstrips economic growth, meaning that Medicare and Medicaid in 40 years will be as big as the entire federal budget today.

In less than 20 years, those three programs, plus interest payments on America's debt, will consume all the tax revenue the nation can expect by then, Bixby said.

"You'd get a crisis long before this," Bixby said.

And then there's what Walker calls financial warfare. Japan and China are America's two biggest lenders. Great Britain is third, followed by a bloc of oil-producing states including Iran, Kuwait, Saudi Arabia and Libya.

So in trade and military disputes, China, as America's No. 2 lender, holds considerable influence.

Foreign lenders, Bixby notes, can demand conditions - or threaten to stop buying U.S. Treasury securities, or even dump their existing holdings outright. To lure other buyers of Washington's debt, U.S. interest rates would then have to rise sharply, throttling the nation's economy.

"It means foreigners have more leverage on us and we have less leverage on them," Walker said. "You have to pay attention to your bankers."

"I don't think we should assume that we are too big to fail," Bixby said.

Growth not enough

All on the tour agree it's a fantasy to argue that the U.S. can grow its way out of its debt, Bixby said. "The economy would have to grow at an implausible rate forever," Bixby said.

Walker and his entourage also concur that few politicians are prepared to deal with an issue that will require sacrifices and hard choices - telling Americans that they cannot borrow forever.

But the next president and Congress cannot duck the issue entirely. For instance, a large portion of President Bush's tax cuts are scheduled to expire in 2010, and many want to extend them.

Walker and the Peterson Foundation are pressing the issue in several other ways.

The foundation recently acquired distribution rights to a documentary film, "I.O.U.S.A.," to be released in 13 cities in August. Walker calls it an "economic 'Inconvenient Truth.' "

The foundation has published "A Citizen's Guide to the Financial Condition of the U.S. Government" on its Web site, www.pgpf.org.

As for the tour, Walker said the biggest audience response comes from the slide he reserves until the end - his three grandchildren.

"We are not only putting ourselves in debt and expecting our kids to pay for it," he said, "we're cutting back on investments in the future."


TOPICS: Business/Economy; Foreign Affairs; Government; News/Current Events
KEYWORDS: economy; taxes
Navigation: use the links below to view more comments.
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1 posted on 06/30/2008 6:06:46 AM PDT by Diana in Wisconsin
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To: Diana in Wisconsin

Walker and his entourage also concur that few politicians are prepared to deal with an issue that will require sacrifices and hard choices - telling Americans that they cannot borrow forever.

Are these the same politicians that have been telling us that importing is good and that we don’t need manufacturing?


2 posted on 06/30/2008 6:10:01 AM PDT by freedomfiter2 (It's too bad I've already promised myself to never vote for McCain.)
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To: Diana in Wisconsin

OPEC could buy up America’s own energy resources, oil fields, etc. Or it could simply become to expensive for us to develop what we have.


3 posted on 06/30/2008 6:10:17 AM PDT by Brian S. Fitzgerald
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To: Diana in Wisconsin

I think the bottom line to us serfs is the following:

1. Interest rates must and will go up

2. Get out of debt

3. Live well below your means

4. Save


4 posted on 06/30/2008 6:10:39 AM PDT by 2banana (My common ground with terrorists - they want to die for islam and we want to kill them)
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To: 2banana

This “serf” and the generation of “serfs” before her have always lived that way. ;)


5 posted on 06/30/2008 6:12:04 AM PDT by Diana in Wisconsin (Save The Earth. It's The Only Planet With Chocolate.)
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To: freedomfiter2
Are these the same politicians that have been telling us that importing is good and that we don’t need manufacturing?

If you buy a Swiss watch, you are not adding to the national debt. If a politician in D.C. spends more than we take in as taz revenue, he adds to the national debt. Understand the difference?

6 posted on 06/30/2008 6:12:34 AM PDT by 1rudeboy
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To: Diana in Wisconsin
federal commitments including debt service over the next 75 years will total $53 trillion - which comes to $175,000 for every man, woman and child in the U.S. today

Nice mathematical obfuscation.

In other words, $2,333 per person per year - or, assuming a working life from age 21 to age 65, then $4000 per year.

Or 9.1% of per capita GDP - assuming that the US population does not increase at all in 75 years.

7 posted on 06/30/2008 6:13:09 AM PDT by wideawake (Why is it that those who call themselves Constitutionalists know the least about the Constitution?)
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To: freedomfiter2
You seem to have the US balance of trade and the federal budget confused.
8 posted on 06/30/2008 6:14:31 AM PDT by wideawake (Why is it that those who call themselves Constitutionalists know the least about the Constitution?)
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To: freedomfiter2

as long as the American people are addicted to getting the “freebie” from the gov’t nothing will change. For we have become addicted that that most addictive and destructive substance known to any system of “ self government”. OPM (Other Peoples Money) And as long as we elect pushers (er ah I mean politicians) who’s great claim is that they will provide more of it, we will be vulnerable.


9 posted on 06/30/2008 6:15:52 AM PDT by MCCRon58 (Freedom does not mean you are free from the consequences of your own freely made decisions.)
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To: Diana in Wisconsin

First thing I would do was stop all monies going to other countries until our debt is settled. We are giving North Korea 36 million or more...that would go to the debt immediately. Isn’t that what we do for our family budget. How many people in huge debt give their poor relative a “loan”...hopefully not too many. Why does America? We cannot afford to be giving out money like water any longer. Stop the insanity!!! Wake up America!


10 posted on 06/30/2008 6:15:53 AM PDT by napscoordinator
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To: 2banana

“I think the bottom line to us serfs is the following:

1. Interest rates must and will go up

2. Get out of debt

3. Live well below your means

4. Save”

or, the government can opt for inflating the way out of debt and obligations.

Your choice - the prudent one - is one that takes sustained effort and discipline for individuals and government.

The inflation choice - the easy one - allows politicians to demagogue, point fingers, and shift blame - and then institute social programs, and “security measures” to deal with the effects

Now, there used to be a time when one could trust our government to do the right thing. It’s too easy to keep promising the big promises, then blame someone else when the promises are either fulfilled or fulfilled at pennies on the dollar due to hyperinflation.

The hard way requires tough leadership & sacrifice, the easy way requires continued irresponsibility and short-term thinking. Which one do you think our government will take?


11 posted on 06/30/2008 6:18:29 AM PDT by RFEngineer
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To: Diana in Wisconsin

Long before the money runs out, American-plan socialism will distract citizens with the usual array of deceits.

Blame will be assigned to some sections of the population, terror will be unleashed upon them, injustice will be a way of life.

Just the normal socialist stuff - nothing to see here.


12 posted on 06/30/2008 6:19:21 AM PDT by headsonpikes (Genocide is the highest sacrament of socialism.)
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To: headsonpikes

“Just the normal socialist stuff - nothing to see here.”

Yes, and the sheeple will just keep moving on.


13 posted on 06/30/2008 6:21:57 AM PDT by spanalot
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To: Diana in Wisconsin

“Social Security, Medicare and Medicaid constitute 42% of the federal budget”

And of that 42%, how much is being spent on illegal alien families with anchor babies?

END BIRTHRIGHT CITIZENSHIP and stop all federal (and state) aid to illegal aliens.

IMO, this is a greater magnet than jobs and doing just as much damage, if not more.


14 posted on 06/30/2008 6:24:23 AM PDT by Kimberly GG (Don't blame me.....I support DUNCAN HUNTER.)
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To: Diana in Wisconsin
But the next president and Congress cannot duck the issue entirely. For instance, a large portion of President Bush's tax cuts are scheduled to expire in 2010, and many want to extend them.

Why shouldn't we extend them? Mr. Walker doesn't say what might happen to the national debt if those tax increases he seems to be in favor of cause a prolonged recession - which they will.

Mr. Walker, like so many others, thinks that our money in the hands of people who cannot control their spending is better than us being allowed to keep it. Our national debt is about 66% of GDP. Japan's is 160% of GDP. I wonder if Walker believes Japan is more doomed than we are and should immediately increase taxes? The only real alternative is to cut spending on entitlements. Given Obama's appeal, I'm not holding my breath.

15 posted on 06/30/2008 6:24:30 AM PDT by Mase (Save me from the people who would save me from myself!)
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To: Diana in Wisconsin

you will not see any progress on these issues from either presidential candidate.


16 posted on 06/30/2008 6:24:48 AM PDT by ken21 ( people die + you never hear from them again.)
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To: Diana in Wisconsin

The the poll taken last week shows Americans’ confidence in congress is at an all time low nearly hitting a 10 per cent approval rating. The world’s confidence in America as the economic engine of a global economy seems to be at an all time low as well, if the crashing and bottoming of the dollar has any significance. I read those two as the seeds of economic decline which have been planted over the past years have finally matured and we have absolutely NO SIGNS of any leaders or leadership from any sector that might be able to effectively address the reality that we find ourselves in.


17 posted on 06/30/2008 6:30:27 AM PDT by Biblebelter
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To: Diana in Wisconsin
I've been telling people for a couple years that financial attacks, and financial terrorism are far more dangerous to this country than a plane flown by a madman.
18 posted on 06/30/2008 6:31:18 AM PDT by Bear_Slayer (When liberty is outlawed only outlaws will have liberty.)
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To: RFEngineer
The inflation choice - the easy one - allows politicians to demagogue, point fingers, and shift blame - and then institute social programs, and “security measures” to deal with the effects

The politicians will take the easy way out and try to inflate their way out of this mess - which WILL lead to much higher interest rates (as the world is not going to fall for it)...

The FED can only control very short term interest rates. The rest are set by the market.

19 posted on 06/30/2008 6:32:19 AM PDT by 2banana (My common ground with terrorists - they want to die for islam and we want to kill them)
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To: Diana in Wisconsin

FROM:

http://www.abovetopsecret.com/forum/thread366951/pg1

posted on 27/6/2008 @ 17:07

more infoWhat is a billion? Too true to be funny

If this is the wrong spot for this mods, please move it to the right place!!

VV

The next time you hear a politician use the word ‘billion’ in a casual manner, think about whether you want the ‘politicians’ spending YOUR tax money.

A billion is a difficult number to comprehend, but one advertising agency
did a good job of putting that figure into some perspective in one of its releases.

A. A billion seconds ago it was 1959.

B. A billion minutes ago Jesus was alive.

C. A billion hours ago our ancestors were living in the Stone Age.

D. A billion days ago no-one walked on the earth on two feet.

E. A billion dollars ago was only 8 hours and 20 minutes, at the rate our government is spending it.

While this thought is still fresh in our brain, let’s take a look at New Orleans. It’s amazing what you can learn with some simple division

Louisiana Senator, Mary Landrieu (D),is presently asking the Congress for $250 BILLION to rebuild New Orleans.

Interesting number, what does it mean?

A. Well, if you are one of 484,674 residents of New Orleans (every man, woman, child),you each get $516,528.

B. Or, if you have one of the 188,251 homes in New Orleans, your home gets $1,329,787.

C. Or, if you are a family of four, your family gets $2,066,012.

Washington, D.C. < HELLO! >
Are all your calculators broken??

Accounts Receivable Tax
Building Permit Tax
CDL License Tax
Cigarette Tax
Corporate Income Tax
Dog License Tax
Federal Income Tax
Federal Unemployment Tax (FUTA)
Fishing License Tax
Food License Tax
Fuel Perm it Tax
Gasoline Tax
Hunting License Tax
Inheritance Tax
Inventory Tax
IRS Interest Charges (tax on top of tax),
IRS Penalties (tax on top of tax),
Liquor Tax,
Luxury Tax,
Marriage License Tax,
Medicare Tax,
Property Tax ,
Real Estate Tax,
Service charge taxes,
Social Security Tax,
Road Usage Tax (Truckers),
Sales Taxes,
Recreational Vehicle Tax,
School Tax,
State Income Tax,
State Unemployment Tax (SUTA),
Telephone Federal Excise Tax,
Telephone Federal Universal Service Fee Tax,
Telephone Federal, State and Local Surcharge Tax,
Telephone Minimum Usage
Surcharge Tax,
Telephone Recurring and
Non-recurring Charges Tax,
Telephone State and Local Tax,
Telephone Usage Charge Tax,
Utility Tax,
Vehicle License Registration Tax,
Vehicle Sales Tax,
Watercraft Registration Tax,
Well Permit Tax,
Workers Compensation Tax.

STILL THINK THIS IS FUNNY?
Not one of these taxes existed 100 years ago,
and our nation was the most prosperous in the world.

We had absolutely no national debt,
had the largest middle class in the world,
and Mom stayed home to raise the kids .

What happened?
Can you spell ‘politicians!’

And I still have to ‘press 1’ for English.

I hope this goes around the U S A at least 100 times!!

signature
~No one saves us but ourselves. No one can and no one may. We ourselves must walk the path.



20 posted on 06/30/2008 6:45:51 AM PDT by Quix (WE HAVE THE OIL NOW http://video.google.com/videoplay?docid=3340274697167011147)
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To: 2banana; RFEngineer

The inflation question was asked at the Madison event earlier this year. Dave Walker said that entitlements are indexed to inflation so it wouldn’t do any good.


21 posted on 06/30/2008 6:51:24 AM PDT by militem (Looking for a decent candidate for Congress)
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To: militem
The inflation question was asked at the Madison event earlier this year. Dave Walker said that entitlements are indexed to inflation so it wouldn’t do any good.

I know - that is the rock/hard place problem and why the FED lies about the true rate of inflation. BUT - The FED can NOT control anything but very short term interest rates. Medium and long term rates are set by the market and I think that is going to change and go much higher.

I have been looking into RTPIX, RRPIX, PST and TBT as a way to invest to what I think is going to happen...

22 posted on 06/30/2008 6:56:19 AM PDT by 2banana (My common ground with terrorists - they want to die for islam and we want to kill them)
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To: 2banana

This would be good advise to our government.


23 posted on 06/30/2008 6:57:02 AM PDT by RC2
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To: Quix
Old email.

A. A billion seconds ago it was 1959.

No it it up to 1976. That means this email has been around for 17 years. (1 billion seconds = 31.69 years)

B. A billion minutes ago Jesus was alive.

And quite cranky at about 110 years old. (1 billion minutes = 1901 years).

E. A billion dollars ago was only 8 hours and 20 minutes, at the rate our government is spending it.

Now it is closer to 3 hours. ($1 billion / $2.9 trillion * 365 days * 24 hours = 3.02 hours)

24 posted on 06/30/2008 6:58:32 AM PDT by KarlInOhio (Whale oil: the renewable biofuel for the 21st century.)
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To: Diana in Wisconsin

“I’m sure that people during the Roman Empire never thought that that Rome would fall,”

...and yet, where would we be today, if it hadn’t?


25 posted on 06/30/2008 7:22:32 AM PDT by stuartcr (Election year.....Who we gonna hate, in '08?)
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To: 2banana

For many people, #s 2 & 4 are extremely hard to do at the same time and it never works out that way.


26 posted on 06/30/2008 7:25:22 AM PDT by stuartcr (Election year.....Who we gonna hate, in '08?)
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To: Quix

1B Zimbabwe $ = approx 1 US $


27 posted on 06/30/2008 7:30:51 AM PDT by stuartcr (Election year.....Who we gonna hate, in '08?)
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To: Diana in Wisconsin

Good article, unfortunately written about five years too late.


28 posted on 06/30/2008 7:41:32 AM PDT by milky
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To: Diana in Wisconsin

Can we sell ‘debt credits’ to other governments like the ‘carbon credits’ proposals?


29 posted on 06/30/2008 8:38:37 AM PDT by wildbill ( FR---changing history by erasing it from memory.)
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To: 2banana
“The politicians will take the easy way out and try to inflate their way out of this mess - which WILL lead to much higher interest rates (as the world is not going to fall for it)...”

Oh, higher interest rates for sure, but of greater concern are the radically higher tax rates (since even at high interest rates, US debt will be treated much like CDO debt is today)

So, if, as one poster pointed out, that entitlements indexed for inflation are honored (they won't be....but that's another story) and nobody will loan us money, then where will the government get the money? “The Rich”.....”Big Oil”....”Greedy CEO’s and their company's” The productive will be put out of business (or forced into the black market).

30 posted on 06/30/2008 8:50:43 AM PDT by RFEngineer
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To: 1rudeboy; wideawake

For the GOP to redeem itself it’s going to take people coming forth with revolutionary ideals - not more of the same stuff we have been seeing for the past 20 years or so.

The article says that we are increasingly having to rely on China and oil exporters to bail us out. The national debt problem would never have gotten to where it is without our trade imbalance.


31 posted on 06/30/2008 9:39:13 AM PDT by freedomfiter2 (It's too bad I've already promised myself to never vote for McCain.)
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To: freedomfiter2

/facepalm


32 posted on 06/30/2008 9:41:29 AM PDT by 1rudeboy
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To: Diana in Wisconsin

Borrowing puts our national security in peril. One of the few modifications to the Constitution that I would support is a balanced budget amendment.


33 posted on 06/30/2008 9:42:58 AM PDT by mysterio
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To: freedomfiter2
The article says that we are increasingly having to rely on China and oil exporters to bail us out.

The article says many things.

The question is: are they true?

The national debt problem would never have gotten to where it is without our trade imbalance

Really? So it is impossible for a country with a positive trade imbalance to borrow money?

Or, alternatively, it is impossible for a country with a negative trade imbalance to delever?

Here's a hint: our trade imbalance is currently $61 billion. Our total economy is $13.5 trillion.

In other words, our trade imbalance is 0.4% of our economy.

34 posted on 06/30/2008 9:48:46 AM PDT by wideawake (Why is it that those who call themselves Constitutionalists know the least about the Constitution?)
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To: 1rudeboy

Meant to ping you to 34.


35 posted on 06/30/2008 9:49:59 AM PDT by wideawake (Why is it that those who call themselves Constitutionalists know the least about the Constitution?)
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To: Diana in Wisconsin; All

What did the founding fathers think about debt?

“I place economy among the first and most important of republic virtues, and public debt as the greatest of the dangers to be feared.” -Thomas Jefferson to William Plumer, 1816

“Within our own borders we possess all the means of sustenance, defense, and commerce; at the same time, these advantages are so distributed among the different states of this continent as if nature had in view to proclaim to us be united among yourselves, and you will want nothing from the rest of the world.” Samuel Adams July 4, 1776, on Independence

“No generation has a right to contract debts greater than can be paid off during the course of its own existence.” - George Washington to James Madison 1789.


36 posted on 06/30/2008 9:51:10 AM PDT by AuntB (Vote Obama! ..........Because ya can't blame 'the man' when you are the 'man'.... Wanda Sikes)
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To: Diana in Wisconsin

No comment? The article is total BS. The foreign investors cannot call in the debt. They are stuck, powerless, watching their investment deflate every day. Tough.


37 posted on 06/30/2008 9:54:15 AM PDT by RightWhale (I will veto each and every beer)
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To: stuartcr

“The Roman Republic fell, not because of the ambition of Caesar or Augustus, but because it had already long ceased to be in any real sense a republic at all. When the sturdy Roman plebeian, who lived by his own labor, who voted without reward according to his own convictions, and who with his fellows formed in war the terrible Roman legion, had been changed into an idle creature who craved nothing in life save the gratification of a thirst for vapid excitement, who was fed by the state, and who directly or indirectly sold his vote to the highest bidder, then the end of the republic was at hand, and nothing could save it. The laws were the same as they had been, but the people behind the laws had changed, and so the laws counted for nothing.” - Teddy Roosevelt


38 posted on 06/30/2008 9:54:19 AM PDT by AuntB (Vote Obama! ..........Because ya can't blame 'the man' when you are the 'man'.... Wanda Sikes)
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To: wideawake
I have no problem with people who think our trade deficit is detrimental. I have a problem with people who think addressing our trade deficit will work towards our budget crisis.

I just bought a twelve-pack of Foster's. I added to our trade deficit. I didn't do squat with regard to our budget deficit.

39 posted on 06/30/2008 10:00:26 AM PDT by 1rudeboy
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To: wideawake; 1rudeboy; Mase
Really? So it is impossible for a country with a positive trade imbalance to borrow money?

Ask Japan. They've had huge trade surpluses since forever. Here's the last 20 years or so. Their government debt is about 150% of GDP, according to this.

If our level of 66% means we're doomed, I guess Japan died about 5 years ago.

40 posted on 06/30/2008 10:06:02 AM PDT by Toddsterpatriot (Why are doom and gloomers, union members and liberals so bad at math?)
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To: Mase

People also don’t look at the asset side of the U.S. ledger. The government (us) own 65% of the land in this country and all the mineral wealth, buildings, etc. on it. What is 800 billion barrels of oil shale worth? Several trillion dollars probably. Coal, brudges, highways, etc.

Obviously the answer is to reform entitlements but blaming politicans is a waste of time. The people in this country don’t want it to happen. It is clear to me the people lead and political leaders follow, or are voted for when they mirror the people’s mood.

In 1976 people were not ready for Reagan, not after just coming out of Vietnam. But they were ready after 4 years of Carter. In the 30s the Brits were not ready for Churchill as he warned them of the Nazi threat. But who did they turn to when war started. And five minutes after Germany surrendered they kicked their greatest leader to the curb because the people wanted to go in another direction.

Our leaders are for the most part a reflection of ourselves. Sad but true.


41 posted on 06/30/2008 10:28:11 AM PDT by DHerion
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To: Toddsterpatriot

Bingo.


42 posted on 06/30/2008 11:02:16 AM PDT by wideawake (Why is it that those who call themselves Constitutionalists know the least about the Constitution?)
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To: Toddsterpatriot
Oh, and Japan was going to conquer America economically 20 years ago, right?

That's what everyone was crying about back then - the last time America was about to collapse.

43 posted on 06/30/2008 11:05:07 AM PDT by wideawake (Why is it that those who call themselves Constitutionalists know the least about the Constitution?)
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To: 1rudeboy
I have no problem with people who think our trade deficit is detrimental. I have a problem with people who think addressing our trade deficit will work towards our budget crisis.

I'm in complete agreement.

44 posted on 06/30/2008 11:08:18 AM PDT by wideawake (Why is it that those who call themselves Constitutionalists know the least about the Constitution?)
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To: wideawake

I don’t get it. If I have nothing in the bank, and buy that Foster’s on my credit card, the argument is that I should’ve bought Budweiser on my credit card instead.


45 posted on 06/30/2008 11:11:20 AM PDT by 1rudeboy
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To: 1rudeboy
Clearly that line of argument makes no sense.

Moreover, think about it intuitively: government borrowing in excess should reduce the value of the dollar, which would theoretically increase the attractiveness of US exports to foreigners and decrease the attractiveness of foreign imports to US consumers.

Reducing leverage by itself should increase a trade imbalance.

46 posted on 06/30/2008 11:19:16 AM PDT by wideawake (Why is it that those who call themselves Constitutionalists know the least about the Constitution?)
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To: KarlInOhio

Not tooo surprised.

I have to do statistics by the manual.

Thanks.

I think the points are still worth pondering.


47 posted on 06/30/2008 12:02:54 PM PDT by Quix (WE HAVE THE OIL NOW http://video.google.com/videoplay?docid=3340274697167011147)
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To: stuartcr

LOL

Thx.


48 posted on 06/30/2008 12:03:24 PM PDT by Quix (WE HAVE THE OIL NOW http://video.google.com/videoplay?docid=3340274697167011147)
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To: freedomfiter2; Toddsterpatriot
The article says that we are increasingly having to rely on China and oil exporters to bail us out.

Bail us out of what? The Japanese have had large trade surpluses for 20 years now yet their economy has been sucking wind for the past 18 years. How do you explain that away given they have a strong currency?

In 1989 they were eating shaved gold on their sushi and plotting to dominate the world's economy. Today they still can't get their economy going while 40 year old professionals have to live with their parents because they can't afford a home. Is that the kind of economy you think we should emulate?

49 posted on 06/30/2008 1:05:36 PM PDT by Mase (Save me from the people who would save me from myself!)
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To: 2banana
"Live well below your means"

What a GREAT POST! The above live, an aged and proper way to live in the last century, "below your means", is exactly how my parents raised their four children. Yes, I've spent too much on C.C.'s before, but I've been able to pay them off quickly too, and I am now more fiscally responsible than I have ever been in my life. I don't like the feeling of being in "Debt" to anyboby or any credit card company. My wife and have 2 cards between us and they get paid off at the end of every month now. We've raised a generation of people who must have what they want "Right Now" and it is to the detriment of this country, much less their emotional health. The question is, how are all the people who don't have the extra funds to cover their minimum monthly payments on their C.C.'s, going to LIVE when they can't afford to pay it or the cards off??? That is a cause of great wonderment for me. I know some people who have $10-15K on their cards and they're paying $335-390 Per Card every Month, and I don't know how they do it, it's a real waste of emotions to NOT live within your means, that's what I've found.

50 posted on 06/30/2008 3:08:55 PM PDT by Pagey (Horrible Hillary Clinton is Bad For America, Bad For Business and Bad For MY Stomach!)
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