קסם וחסר מזה

Enchantment and lack thereof

My Photo
Name:
Location: Columbus, Ohio, United States

Wednesday, December 15, 2004

Economic Bad News

As you may have heard, America is amidst a severe trade deficit. The United States, a constant debtor, is dealing with a fiscal deficit 3 times bigger than any other deficit in history. We Americans love big things. As a result of this deficit, the American Dollar is weakening. The value of the dollar has been sliding since February 2002. Because of the American trade deficit, the United States has had to borrow money from other countries. This borrowing is the main reason for the decline in the dollar.

President Bush, as he does with all things he doesn't understand, is ignoring this problem. The White House is taking the "let's leave it alone and it will fix itself" stance on this issue. The President is too busy opening the floodgates of corporate campaign financing and securing a wealthy future for himself and a few of his friends. The American people are going to suffer as a result.

The increase in deficit, as predicted by the Congressional Budget Office, will be exponential as a result of Bush's stupid war, his continuing tax cuts for billionaires and corporations, and his daft economic policy. We already notice rising gas prices as a result of the declining dollar. Soon mortgage rates will rise, stock indices will fall, and companies will once again lay off thousands of employees due to shrinking profits.

A cheaper dollar would not be as threatening if it was part of a comprehensive strategy to close the trade deficit. For instance, the United States must demonstrate to our trading partners and the currency markets that it intends to reduce the federal budget deficit - thereby lessening its need to borrow from abroad and reducing downward pressure on the dollar. Unless and until it does so, the United States will lack the credibility and the authority to press for changes that need to occur in other countries to balance out global trade. There are alternatives to a single-minded pursuit of a weak dollar fix. What is lacking is the leadership to pursue them, and it is going to lead to a depression.

0 Comments:

Post a Comment

<< Home