Newspaper logo  
 
 
Local Stories, Events

Ref. : Civic Events

Ref. : Arts & Education Events

Ref. : Public Service Notices

Books, Films, Arts & Education
Letters

Ref. : Letters to the editor

Health Care & Environment

09.25 Labour wants green energy to power most UK homes by 2030

09.25 US to be hit worse than almost any other country by climate change, report says [“Stupid is as stupid does.” –Forrest Gump]

09.25 Climate gentrification: the rich can afford to move – what about the poor?

09.25 Monsanto's global weedkiller harms honeybees, research finds

09.24 Everything you've been told about plastic is wrong – the answer isn't recycling

09.24 Unlocking secrets of sea level rise in Greenland [15 minute video]

09.24 Air pollution rots our brains. Is that why we don’t do anything about it?

09.24 What are public lands?

09.24 The Netherlands Unveils the World's First Recycled Plastic Bike Lane

09.24 Americans: the next climate migrants 'We're moving to higher ground': America's era of climate mass migration is here [estimates do not include migrants from other nations even more affected]

09.24 Opec predicts massive rise in oil production over next five years [wonderful for fossil fuel investors; terrible for all plants and animals]

09.23 Nasa launches satellite to precisely track how Earth's ice is melting

09.23 Climate study ‘pulls punches’ to keep polluters on board

News Media Matters

Daily: FAIR Blog
The Daily Howler

US Politics, Policy & 'Culture'

09.25 Dozens Arrested as Survivors Flood Capitol Hill to Share Trauma of Sexual Assault, Demand Senate Reject Kavanaugh

09.25 Why I find the Kavanaugh/Ford case so unsettling

09.25 The Republican party is about to face the wrath of women

09.25 Trump has given women yet another reason not to report rape

09.24 Sexual assault is fun if we can all 'lighten up' about it

09.24 Brett Kavanaugh faces second allegation of sexual misconduct09.23 MARYLAND GOVERNOR REBUFFS CALL FOR CRIMINAL INVESTIGATION INTO BRETT KAVANAUGH ATTEMPTED RAPE ALLEGATIONS [Republicans above the law...]

09.23 Trump Is Strangling the U.S. Refugee Program to Death

09.23 Michael Moore's "Fahrenheit 11/9" Aims Not at Trump But at Those Who Created the Conditions That Led to His Rise

09.23 The Trump Administration's Latest Tax Scam for the Rich [video]

09.23 One Tiny Tax Reform, Billions for America

Justice Matters

09.22 Making Tariffs Corrupt Again

09.22 Why isn't Mark Judge testifying about Kavanaugh? He is an alleged witness

High Crimes?

09.20 Trump Should Be More Worried About the Brennan Dossier

09.19 'Killing a generation': one million more children at risk from famine in Yemen [Does America's government have empathy? Does it understand the concept of morality? The Saudi Air Force would be ineffective without U.S. military assistance...]

09.19 ‘Tied to trees and raped’: UN report details Rohingya horrors

Economics, Crony Capitalism

09.23 The Spider’s Web: Britain’s Second Empire [1:18:01 documentary video; the Book]

09.23 Why We Have To Break Up Amazon

International & Futurism

09.25 US Isolated: Europe’s Big 3, plus China & Russia Outmaneuver Trump to keep Iran Deal at UN

09.25 Spain to Recognize Palestinian State, work for European Union Acceptance

09.25 The male cultural elite is staggeringly blind to #MeToo. Now it's paying for it

09.25 'A smell of death:' Mexico's truck of corpses highlights drug war crisis

09.24 'Stop this disaster': Brazilian women mobilise against 'misogynist' far-right Bolsonaro

09.23 For This Year’s International Day of Peace, Korea Takes the Lead

09.22 Which nation is 'most generous' to refugees? Certainly not the US

We are a non-profit Internet-only newspaper publication founded in 1973. Your donation is essential to our survival.

You can also mail a check to:
Baltimore News Network, Inc.
P.O. Box 42581
Baltimore, MD 21284-2581
Google
This site Web
  Is It Time to Bail Out of America?
Newspaper logo

FISCAL REALITIES:

Is It Time to Bail Out of America?

Astonishing Incongruities

by Paul Craig Roberts
Thursday, 29 January 2009
All the Obama regime sees is a “credit problem.” But the United States is busted. Many of the state governments are busted. Homeowners are busted. Consumers are busted. Jobs are busted. Companies are busted. And Obama thinks he has the money to fight wars in Afghanistan and Pakistan.
California State Controller John Chiang announced on January 26 that California’s bills exceed its tax revenues and credit line and that the state is going to print its own money known as IOUs. The template is already designed.

Instead of receiving their state tax refunds in dollars, California residents will receive IOUs. Student aid and payments to disabled and needy will also come in the form of  IOUs. California is negotiating with banks to get them to accept the IOUs as deposits.

California is often identified as the world’s eighth largest economy, and it is broke.

A person might think that California’s plight would introduce some realism into Washington, DC, but it has not. President Obama is taking steps to intensify the war in Afghanistan and, perhaps, to expand it to Pakistan.

Obama has retained the Republican warmongers in the Pentagon, and the US continues to illegally bomb Pakistan and to murder its civilians. At the World Economic Forum at Davos this week, Pakistan’s prime minister, Y. R. Gilani, said that the American attacks on Pakistan are counterproductive and done without Pakistan’s permission. In an interview with CNN, Gilani said: “I want to put on record that we do not have any agreement between the government of the United States and the government of Pakistan.”

How long before Washington will be printing money?

On January 28 Obama announced his $825 billion bailout plan. This comes on top of President Bush’s $700 billion bailout of just a few months ago.

Obama says his plan will be more transparent than Bush’s and will do more good for the economy.

As large as the bailouts are--a total of $1.5 trillion in four months--the amount is small in relation to the reported size of troubled assets that are in the tens of trillions of dollars. How do we know that by June there won’t be another bailout, say $950 billion?

Where will the money come from?

Obama’s bailout plan, added to the FY 2009 budget deficit he has inherited from Bush, opens a gaping expenditure hole of about $3 trillion.

Who is going to purchase $3 trillion of US Treasury bonds?

Not the US consumer. The consumer is out of work and out of money. Private sector credit market debt is 174% of GDP. The personal savings rate is 2 percent. Ten percent of households are in foreclosure or arrears. Household debt-service ratio is at an all-time high. Household net worth has declined at a record rate. Housing inventories are at record highs.

Not America’s foreign creditors. At best, the Chinese, Japanese, and Saudis can recycle their trade surpluses with the US into Treasury bonds, but the combined surplus does not approach the size of the US budget deficit.

Perhaps another drop in the stock market will drive Americans’ remaining wealth into “safe” US Treasury bonds.

If not, there’s only the printing press.

The printing press would turn a deflationary depression into an inflationary depression.

Unemployment combined with rising prices would be a killer.

Inflation would kill the dollar as well, leaving the US unable to pay for its imports.

All the Obama regime sees is a “credit problem.”  But the crisis goes far beyond banks’ bad investments. The United States is busted. Many of the state governments are busted. Homeowners are busted. Consumers are busted. Jobs are busted. Companies are busted.

And Obama thinks he has the money to fight wars in Afghanistan and Pakistan.

Except for the superrich and those banksters and CEOs who stole wealth from investors and shareholders, Americans have suffered enormous losses in wealth and income.

The stock market decline has destroyed about 45% of their IRAs, 401Ks, and other equity investments. On top of this comes the decline in home prices, lost jobs and health care, lost customers. The realized gains in mutual funds and investment partnerships, on which Americans paid taxes, have been wiped out.

The government should give those taxes back.

Americans who have seen their retirement savings devastated by complicity of government regulators and lawmakers with financial gangsters should not have to pay any income tax when they draw on their pensions.

The financial damage inflicted on Americans by their own government is as great as would be expected from foreign conquest. While Washington “protected” us from terrorists by fighting pointless wars abroad, the US economy collapsed.

How can President Obama even think about fighting wars half way around the world while California cannot pay its bills, while Americans are being turned out of their homes, while, as Business Week reports, retirees will work throughout their retirement (which assumes that there will be jobs), while careers are being destroyed and stores and factories shuttered.

Americans are facing tremendous unemployment and hardship. Obama doesn’t have another dollar to spend on Bush’s wars.

Taxpayers are busted. They cannot stand another day of being milked by the military-security complex. The US government is paying private mercenaries more by the day than the monthly checks it is providing to Social Security retirees.

This is insanity.

The banksters robbed us twice. First it was our home and stock values. Then the government rewarded the banksters for their misdeeds by bailing out the banksters, not their victims, and putting the cost on the taxpayers’ books.

The government has also robbed the taxpayers of $3 trillion dollars to fight its wars. About $600 billion are out of pocket costs, and the rest is on the taxpayers’ books.

When foreign creditors look at the debt piled on the taxpayers’ books, they don’t see a good credit risk.

Washington is so accustomed to ripping off the taxpayers for the benefit of special interests that the practice is now in the DNA. While bailouts are being piled upon bailouts, wars are being piled upon wars.

Before Obama gets in any deeper, he must ask his economic team where the money is coming from. When he finds out, he needs to tell the rest of us.


Paul Craig RobertsPaul Craig Roberts is an economist who served as an Assistant Secretary of the Treasury in the Reagan Administration earning fame as the "Father of Reaganomics". He is a former editor and columnist for the Wall Street Journal, Business Week, and Scripps Howard News Service. He is the author of Supply-Side Revolution: An Insider's Account of Policymaking in Washington; Alienation and the Soviet Economy: The Collapse of the Socialist Era and Meltdown: Inside the Soviet Economy, and is the co-author with Lawrence M. Stratton of The Tyranny of Good Intentions: How Prosecutors and Law Enforcement Are Trampling the Constitution in the Name of Justice.

This article is published in the Baltimore Chronicle with permission of the author.



Copyright © 2009 The Baltimore News Network. All rights reserved.

Republication or redistribution of Baltimore Chronicle content is expressly prohibited without their prior written consent.

Baltimore News Network, Inc., sponsor of this web site, is a nonprofit organization and does not make political endorsements. The opinions expressed in stories posted on this web site are the authors' own.

This story was published on January 29, 2009.

 

Public Service Ads: