It's the Iraq War that's Killing the Economy, Stupid!
Bob Kendall
Economic vultures all over the world delight in seeing what was once the world's economic super power's financial stability being demolished.
Foreigners are buying out major assets as the dollar dramatically declines. Belgium may buy the biggest brewery in the U.S. In 2007 foreign investors spent $414 billion buying some of the biggest assets of the U.S.A.
There is even talk now of the New York City landmark Chrysler Building being sold.
Foreigners who buy out U.S. corporations will have cheap U.S. labor, a labor force anxious to accept jobs they may desperately need to cope with inflation as their currency declines. And they will have to work hard to pay off the $10 trillion debt the Bush Administration generated.
Saudi Arabia and China's bond buying is keeping us afloat. If the U.S. dollar declines much further, they may decline to buy our bonds, and then what?
We are borrowing from China to pay the Saudis for the oil we are using for our gas guzzling SUV's.
All this is going on while George Bush enjoyed a week long European whirlwind farewell tour. In every major city, Bush smiles and waves for TV cameras as if he was on a triumphant farewell tour. With Europeans having a lower popularity rating for Bush than even U.S. low ratings, this is strange.
Glancing back at the Vietnam War, which cost the lives of over 59,000 U.S. service personnel, and over 2.5 million Vietnamese and Cambodians, historians have asked in countless Vietnam books -What was the Vietnam War fought for and precisely what was accomplished?
Is Iraq a re-run?
The fear factor drove the Vietnam War fear. It was perpetrated by a media propaganda campaign. Could it be this was the concerted activity of the military-industrial complex that the Republican President Dwight D. Eisenhower warned us about?
The domino effect was the idea that if the U.S. did not stop the Communists in Vietnam, all of Asia might fall like a row of dominoes into Communist rule.
When the U.S. fled Vietnam and the Communist North Vietnamese took over South Vietnam, all of Asia did not become Communist. The domino effect fear hysteria had been proven false. Even Robert McNamara finally admitted that it was a hopeless war.
How time changes everything! In 2008 China is the biggest trading partner of the U.S.A., with our trade balance to China being in the billions.
The money made possible by the Saudis and China buying U.S. bonds keeps the U.S. functioning economically in 2008.
Don't talk about Democrats being the big spenders. Not when Bush's national debt is bigger than all the previous national debts combined - approaching $10 trillion.
Traders today are considering, due to the drastic dollar decline, ceasing to use the battered U.S. dollar as the world's bench mark currency.
Don't blame the international currency traders for contemplating this possibility. Blame Bush!
With the British pound now worth twice the value of the U.S. dollar and the Euro over 50 percent higher than the dollar's value, the U.S. economic plight is quite apparent.
Gas prices go up, up and away, higher than ever. Food prices, college costs, hospital expenses, building materials, autos, everything is going up. The cost of living is skyrocketing, demolishing the American dream as salaries for American workers slump.
What about those Americans who save their money, putting it in banks for safe keeping?
The last Federal Reserve chief Alan Greenspan lowered interest rates to the lowest level in over 40 years. This triggered the home building bubble, with people investing in residential property as if was the stock market.
Now that the bubble has burst and home prices in many areas have drastically descended, the new Fed chief Ben Bernanke cuts the interest rate repeatedly, just like Greenspan did.
Senior citizens on fixed incomes and the U.S. bond buyers, who keep the nation's economy going, are automatically cheated out of a fair return on their money.
Senior citizens who rely on a fair return on money they have accumulated through a lifetime of hard work, now get a return often less than the inflation rate. This means that banks are using savers and U.S. bond buyers' money for free.
The 2.5 million mortgage foreclosures, by a strange twist of fate, is the same number of mortgage foreclosures that occurred during the Great Depression.
79 million senior citizens (referred to as baby boomers) are looking forward to retirement with social security and Medicare assistance.
All this is occurring while the U.S. dollar crashes and the cost of living increases, with job layoffs in the auto and airline industries.
Homeless people roam the streets, begging for sustenance. A recent CNN report disclosed that the U.S.A., representing only 5 percent of the world's population, uses two-thirds of the world's drug market.
Dante J. Driver of Seattle wrote in the Seattle Post-Intelligencer in the Letters to the Editor on June 18:
"The Federal Reserve has actually been pursing inflationary fiscal and monetary policy since the eighties. Profligate government spending by both parties and historically low tax and interest rates have pumped cash into the economy that fueled the technology, real estate (and arguably the current commodity bubbles)."
More than one hundred years ago, in speaking of American, British historian Lord Macaulay warned, "Your republic will be as fearfully plundered and laid waste by barbarians in the twentieth century as the Roman Empire was in the fifth, with this difference, that the empire came from without and your Huns and vandals will have been engendered within your own country, by your own institutions."