Okay, this is really, really simple and millions of Americans don't get it. The US will require a MASSIVE tax increase over the next decade to pay for Bush's "borrow and spend" madness and the absurd war in Iraq. The Republican candidates for President are falling all over themselves to take "no new tax" pledges and are missing out on the absolute necessity of paying down the national debt.
There's an interesting parallel with people supplementing their income by running up credit cards or refinancing their homes. This is not sustainable. As Stein's Law asserts, "If something can't go on forever, it will end." As rates have adjusted up, and credit tightened, we are seeing increasing home foreclosures and bankruptcy filings. The US is headed for the same thing.
The US government raises about $2 billion a day to pay for the war and other expenses, happily piling up debt. The Chinese, Japanese and Mideast countries continue to loan to us and we take it. When they decide we're not such a good risk, they'll stop and all hell will break loose. Interest rates we pay on the debt will soar as will inflation. I remember the 70's and this is going to get ugly.
0 comments:
Post a Comment