What If the World Decides Not to Be Taken Hostage by Washington Again?

In 2008, made-in-America Casino Capitalism took down economies around the world and, in case you haven't noticed, they haven't come back and won't anytime soon.   Wall Street did what al Qaeda could never dream of achieving.

Now America is once again threatening to scupper the global economy.   Today the terrorists are the rightwing radicals who have seized control of the Republican Party and, through it, the House of Representatives.

The president of the World Bank, Jim Yong Kim, has warned that failure of the White House and Congress to solve America's debt ceiling crisis by the Thursday deadline could be a "disastrous event" for the world.

This is the same America, that steeps itself in fanciful notions of exceptionalism, (and, from that, claims global leadership) again imperiling the global economy, this time through political brinksmanship.

Forget Thursday.  They had no right to bring us to where we stand, threatened, today.   America has a too-long unacknowledged responsibility not to endanger the economies (and security) of every other nation in the world and they have failed us shamelessly.

When your son keeps wracking up speeding tickets in the family car you might think it reasonable to take away his keys.   In the case of the United States that would mean moving to a different world currency or basket of major currencies. America has taken the world for granted too often.  It's endless temper tantrums are getting old.

It emerged at last week's APEC summit that Asia has about had its fill with American domination.  China is realizing that, while America's grip on global dominion is determined, it's also weak.

China is moving to bring down Washington's Trans Pacific Partnership before it can get off the ground.   Congressional Republicans may turn out to be Beijing's best allies.

Putting America's "Wars of Choice" in Perspective

America, land of the formerly free and home of the lamentably broke.

A recent Harvard study estimated the costs of America's wars in Afghanistan and Iraq at at least $4-trillion and likely closer to $6-trillion.

That's six trillion taxpayer dollars, a mountain of money that has been essentially borrowed which makes it an ever-growing mountain of debt.

In an era in which politicians find it advantageous to insulate the voting public from the true costs of their leaders' adventures, amounts like this are almost impossible to grasp.   It's understandable that America's pols prefer that the public not know that they're now on the hook, per household, to the tune of $75,000 for the two wars, the pair, the set.   A "brace" of wars?

Seventy-five grand, seventy-five large per household.   Now there's a figure you can almost wrestle with.

''There will be no peace dividend'', is the stark conclusion from the 22-page report from the Kennedy School of Government, ''and the legacy of Iraq and Afghanistan wars will be costs that persist for decades''.

"There's a sense that we are turning the corner but, unfortunately, the legacy of these wars, because of decision about the way we fought and funded these wars, means we will be paying the costs for a long time to come,'' Professor Bilmes said. ''We may be mentally turning the page but we are certainly not from a budgetary and financial perspective.''
''More than half of the 1.56 million troops who have been discharged to date have received medical treatment … and been granted benefits for the rest of their lives,'' the report said. It also said the real bills would not fall due for decades to come.

The second major hidden cost of the two conflicts would be servicing the debts incurred as a result of the ''unprecedented'' decision to pay for the wars entirely from debt while cutting taxes during wartime.

And that is the legacy the Republicans bequeathed to the United States.   It was Bush/Cheney who enacted not one, but two major tax cuts for the rich while waging two expensive, protracted and hopeless wars on borrowed money as their nation became increasingly mired in debt and deficits.   That was the true face of oligarchy revealed - only the American people couldn't see it staring straight into their faces.

And now, having done this to their own people, they're going to rape them again by cutting their medicaid, medicare, Social Security, even food stamps to pay for their largesse to the richest of the rich.   Isn't it time to storm the Bastille?
 

The Debt Tarnished City on the Hill

Don't look at Washington. Forget Wall Street. Detroit, who cares?

The story of America's real fiscal crisis, the one that will define what the US looks like a decade from now, is to be found in the nation's state houses. Yes, Washington is broke but it's not the federal government that delivers most of the core services on which societies and communities are built.

During America's Age of Darkness (Reagan, Bush I, Bush II), the feds paid scant attention to America's burgeoning national debt, its balance of trade deficits, its balance of payments deficits. But the states were hardly any better. They too gorged on cheap money even as artificially skyrocketing real estate prices and sales taxes from mega purchases their buyers couldn't really afford poured money into state coffers. It was the perfect setup for a recessionary collapse.

And it's not just the slave states that are in a terrible mess. California is struggling with multi-billion dollar deficits. Even the colonial states like Massachussets are in trouble. From the also troubled Boston Globe:

The problems are expected to be so widespread, the solutions so elusive, that the state may have to rethink the size of its commitment to big-ticket programs such as its landmark healthcare coverage plan, aid to cities and towns, and education funding, the specialists said at an emergency budget hearing convened yesterday by members of the state Senate.

Several economic specialists who testified advised state officials to prepare for at least four years of budget problems, foreshadowed by dire records: State revenues declined 35 percent this April over last year, the worst ever. The fall in state revenues for this year, projected to be $3 billion less than budgeted, will probably also be the steepest in state history.

"This is going to be the worst fiscal crisis in the state's history," said Michael J. Widmer, president of the Massachusetts Taxpayers Foundation. "I think it's fair to say it's a catastrophe. That's not an overstatement."

Widmer projects that state tax collections will not return to 2008 levels until at least 2014, as state revenues lag behind a slowly rebuilding economy.

What's by no means certain is how the looming cutbacks in core services - health care and education - will impact the states in the decades to come. America is at a point where it needs more money for healthcare, more money for education, more money for social services yet will have to make do with less money and degraded or sharply curtailed services. These are the sort of programmes that directly impact the health of a society, that are the foundation for its strength. Societies that cannot provide these things are poorly positioned for the future, especially in the face of rapidly emerging rival economies.