It's this article from Chalmers Johnson in TomDispatch.com which paints an ominous picture of the financial future of the United States. Key excerpt:
Many neoconservatives and poorly informed patriotic Americans believe that, even though our defense budget is huge, we can afford it because we are the richest country on Earth. Unfortunately, that statement is no longer true. The world's richest political entity, according to the CIA's "World Factbook," is the European Union. The EU's 2006 GDP (gross domestic product -- all goods and services produced domestically) was estimated to be slightly larger than that of the U.S. However, China's 2006 GDP was only slightly smaller than that of the U.S., and Japan was the world's fourth richest nation.
A more telling comparison that reveals just how much worse we're doing can be found among the "current accounts" of various nations. The current account measures the net trade surplus or deficit of a country plus cross-border payments of interest, royalties, dividends, capital gains, foreign aid, and other income. For example, in order for Japan to manufacture anything, it must import all required raw materials. Even after this incredible expense is met, it still has an $88 billion per year trade surplus with the United States and enjoys the world's second highest current account balance. (China is number one.) The United States, by contrast, is number 163 -- dead last on the list, worse than countries like Australia and the United Kingdom that also have large trade deficits. Its 2006 current account deficit was $811.5 billion; second worst was Spain at $106.4 billion. This is what is unsustainable.
It's not just that our tastes for foreign goods, including imported oil, vastly exceed our ability to pay for them. We are financing them through massive borrowing. On November 7, 2007, the U.S. Treasury announced that the national debt had breached $9 trillion for the first time ever. This was just five weeks after Congress raised the so-called debt ceiling to $9.815 trillion. If you begin in 1789, at the moment the Constitution became the supreme law of the land, the debt accumulated by the federal government did not top $1 trillion until 1981. When George Bush became president in January 2001, it stood at approximately $5.7 trillion. Since then, it has increased by 45%. This huge debt can be largely explained by our defense expenditures in comparison with the rest of the world. [Emphasis added]
Give it a read if you have time. I'd be interested to know what you think. This issue is so much more important than the trivia most our media concentrate on that there is simply no comparison. This is about the life and death of America itself.
9 comments:
I am sitting in my sociology class, being distracted by the inter-web, and I come across this article. My jaw continued to drop as I read on and when I hit the last bolded quote, I nearly lost my jaw to the floor. I consider myself the general public of America, and it seems I have never viewed information that I found so shocking. Maybe I am living in blissful ignorance but this is something more people need to learn about and realize this is reality.
I'm glad to hear from you on this, Chris.
After World War II, we were the only country left standing and we rebuilt the world. Our economy was great in the 50's and 60's. But now the world is catching up to our ability to make goods while increasing their standard of living. Because our standard of living was so much higher, it is only logical that when the world's increases ours must decrease until parity exists. We are in this process now and until China and India catch up, jobs will continue to leave the USA and more foreign goods will be imported. Europe's solution is protectionism which is why they have 12% unemployment. Are you suggesting we become protectionist? This action will lead to wars, trade and otherwise.
Anonymous, this has nothing to do with the relative SHARE of the world's product we have. It is about profligacy, waste, ludicrously huge defense expenditures, and fiscal irresponsibility. As recently as the 1980s America was a creditor. Now it is a debtor because of indiscipline. There was no economic need for the U.S. to go from having a $900 billion debt in 1980 to a $9 TRILLION debt now. Think about where that debt came from.
You're right. Stop giving Social Security and Medicare to the wealthy. Stop wasting education dollars to keep the teachers union happy, overpaid, and with their monopoly complete. Stop government employees from retiring after 30 years while the public pays for it. The best thing we could do is eliminate government pensions. Replace the pensions with a 401K like in the real world and make them work until their 65, like their benefactors, the tax paying public. Eliminate farm susbsidies, too. Ever since Al Gore scared everyone to act like Chicken Little and ethanol became subsidized, corn prices have gone through the roof. Burning our food as fuel is a horrible idea. Thanks for that Senator Harkin. And implement term limits for all offices to eliminate the special class of American called 'Politician' that never looses his job. No more foreign aid if your government sponsors terroists. And no more inflationary Cost-Of-Living wage increases to unions.
You sound like a typical brainwashed right winger. As a former high school teacher who lives off a government pension, I violently resent your insulting remarks about me. "Overpaid"?? Check out the pay of elementary teachers, whose work is so crucial to our children. "Overpaid"?? My education level puts me in the top TWO PER CENT of the U.S. population. How about yours? "Maintain our monopoly"? Gee, the parochial schools will be surprised to hear that they don't exist. What the hell is it with you people? You swallow every bit of right wing anti-public education propaganda without thinking but never bother to try and find out the truth. I was a GREAT teacher and I earned my money. (BTW, want great teachers? Offer great incentives, like excellent pay and benefits. It's called common sense. Offer lousy pay and you get lousy people in the profession.) Why is it that unions are always the bad guys but bastards like the guy who ruined Countrywide and then walked off with $86 million are heroes? (Read this post here: http://jamillerrampant.blogspot.com/2007/06/on-retiring-after-33-years-as-teacher.html
if you want to know the truth about the role public education plays.)
60% of U.S. corporations pay no tax, including Fox News, which you no doubt believe to be gospel.The oil industry continues to be subsidized, as does tobacco and a hundred other things rightwingers have financial interests in. Tax dodges for hedge fund owners means they are taxed at a LOWER rate than ordinary workers, even though they create NOTHING of value. Yes, ethanol is a stupid idea, which is also why every Republican in Iowa favors it. Tell ya what else was stupid pal:
Reagan pulling the plug on alternative energy in 1981
The Bush family getting away with being palsie-walsies with the Saudis
Reagan deregulating the financial and banking industries in the 80s, which is DIRECTLY responsible for the looming disaster in finance we face today.
The CONSERVATIVE REPUBLICANS taking us from $900 billion in public debt in 1981 to over $9 TRILLION today.
Guys like you amaze me. You take responsibility for NOTHING. You see NOTHING, including the massive scientific evidence of global warming, that you don't want to. Everything is the fault of the demons you've been brainwashed to think are at fault--evil "libruls", unions, teachers, "Feminazis", and all the rest. I have laid out my case against conservative lies, criminality, corruption, and economic greed in exhaustive detail. Either you've never bothered to read any of it, or you just didn't care. Well, before you slap me in the face for being a teacher, you damned well better study up--and then come and talk to me.
The average salary of teachers in my town is about $90K and they retire at 52 with a pension of about $65K. (Our football coach retired at 58 with a $125,000 salary and almost a $90K pension.) I call that overpaid. Getting an advanced degree is just a way to get a pay increase. You didn't need it to get or keep your job.
I'm sure you were a good teacher, but unless you're 65, you should still be teaching. I agree that that the Countrywide exec and Exxon's CEO that got almost $450 million is outrageous. So I'd agree to a law that limited this kind of largesse if you'd agree to agree to limit the power of unions.
We need to work together as a country, not draw lines in the sand. Stop blaming everything on Republicans. The Democrats held both Houses of Congress throughout the '80's and up until 1994. Earmarks are prevalent on both sides of the aisle.
No one questions that the Earth is warming, but to blame mankind is of doubt. There are plenty of scientists who believe likewise. The science of climatology is only 30 years old, so they're still learning. The people trying to scare us with global warming are people like Dr Paul Ehrlich of Cal-Berkeley who wrote the book Population Bomb in 1968 that warned of the coming of drastic overpopulation by 1980. He was wrong. Then there was the Global Cooling crowd from the 1970's or the Acid Rain fear from the 1980's that was disproved with the $300million federally funded NAPAP study. NASA says the entire universe is warming and that cannot be our fault.
Stop getting your facts from unreliable blogs like the Daily Kos and Media Matters. I get mine from federal government agencies like the OMB and CBO. To state that 60% of all corporations pay no tax is laughable.
Finally, no one is going to take you seriously if you keep up the ad hominem attacks. I'm not right-wing or Republican, I'm Libertarian. I believe in as little government as necessary. Government does not create wealth merely redistribute it. Wealth is created by those entites you hate... corporations. They employ the people that pay the tax that pays government employees, so you should love them. They're your benefactors.
Anonymous, I don't know where you live, but if the AVERAGE as opposed to TOP high school teaching salary is $90,000, I wish I could have worked in your area. Here is a link showing MEDIAN (not average) salaries in large metro areas:
http://www.payscale.com/research/US/Job=High_School_Teacher/Salary
The median salary is about $50,700.
Here is the link:
http://swz.salary.com/salarywizard/layouthtmls/swzl_compresult_national_ED03000011.html
And retire at 52? Where? And a coach at $125,000? Do you live in Texas? If true, that salary is absurdly high, I would agree, but where is this coaches paradise? BTW my advanced degree did earn me more money. It also vastly expanded my knowledge and improved my teaching. I did my post-grad work in history.
Yes, 60% of U.S. corporations pay no income tax. Here are the relevant sites:
http://www.gao.gov/docdblite/details.php?rptno=GAO-04-358
http://www.gao.gov/docdblite/details.php?rptno=GAO-04-358
(The above is the full GAO report)
It's true. And the percentage of income tax burden borne by companies has decreased dramtatically.
Corporations are not here to be benevolent, I understand that, but they must obey the law. They regularly violate tax and accounting rules, regularly violate environmental laws, and too often act as bad citizens. I'm a capitalist, but a believer in REGULATED capitalism. BTW, there is no such thing as the free market. There is the manipulated/lobbied/bought/bribed market, just as we had in the decades between the Civil War and the passage of the Sherman Anti-Trust Act. Too often corporate lobbyists have outrageous clout in the government. We are on the same page in regard to corporate welfare, I think, but just try and cut it. Yes, many Democrats are also culpable in these matters.
The teacher's union I helped start in my own school raised salary and benefits significantly, but it also raised the level of professionalism. We were challenged to earn our money; we did. The reason I am no longer a conservative is that I used to be flogged all the time with propaganda from the right excoriating my profession for everything that is wrong with America. The tired "Teachers Union" attack got old, to say the least. If they weren't necessary, they wouldn't have been formed.
Again, read my post about teaching from my previous comment. It will tell you where I'm at.
I get a lot of flack from rightists. I'm sorry if I assumed you were just another one. I am socially libertarian, btw, but economically I tend not to be. It's because I am deeply cynical about human beings and laissez faire economics.
"No one questions that the Earth is warming, but to blame mankind is of doubt. There are plenty of scientists who believe likewise. The science of climatology is only 30 years old, so they're still learning. The people trying to scare us with global warming are people like Dr Paul Ehrlich of Cal-Berkeley who wrote the book Population Bomb in 1968 that warned of the coming of drastic overpopulation by 1980. He was wrong. Then there was the Global Cooling crowd from the 1970's or the Acid Rain fear from the 1980's that was disproved with the $300million federally funded NAPAP study. NASA says the entire universe is warming and that cannot be our fault."
Even if it's not proveable, the threat alone is enough to warrent taking action. We have ONE Planet, and I think protecting it should be of the highest priorty.
"And no more inflationary Cost-Of-Living wage increases to unions."
How do increases cause inflation? Inflation is already here, in 2004 the min wage needed to be raised to 11 dollars to allow for people to be removed from poverty. Today its higher still.
"We need to work together as a country, not draw lines in the sand. Stop blaming everything on Republicans. The Democrats held both Houses of Congress throughout the '80's and up until 1994. Earmarks are prevalent on both sides of the aisle."
I agree that we need to work together as a country. This means accepting reality, the right does not do this, right wingers have been notrious for this for the last 80 years. If we choose not to act on reality, reality will bite us in the ass.
Billions of dollars a day go into a war that nethier country desires, egged on and prodded by a Neo-Con adminstration.
Not only does the country not want it but the military doesn't want it. I spend a great deal of time around memebers of our Military, in five years I have heard nothing said in favor of this war, and plenty agaisnt it. Ending this war will do wonders for combating the debt, and is really the only way to truly support our soliders, wo bravely go forth doing thier duty even though they understand the futilty of it.
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