dr. elsewhere here
This administration has frequently and long been called reckless, starting with their push to invade Iraq, though at that point those early calls were like faint cries from another planet to Bubba watching the Super Bowl.
Now though, there is almost something beyond reckless, something almost suicidal about their behaviors. And I am not dismissing the image of a suicide bomber taking down all proximal innocents in the process.
The Keystone Kabal has done so many things so wrong in the past several years, and what they were able to “accomplish” was done by extortion and bribery, lies and cheating. But now their many crimes are coming home to roost, all at once. I need not count the ways here; readers know, and besides, many have done such great jobs of listing most of the more offensive errors, such as here, and here.
Joe’s take on the absurdity of this port situation is particularly intriguing for its bold exposure of the flaming contradiction. For the one or two folks in the comments section who do not seem to grasp the importance of that contradiction, I'll spell it out here. Whereas the Bush administration has capitalized on and made their entire program dependent on their claim to be tough on terror, they have sold off our port control to a company run by a state where 9/11 hijackers were based and banked, and where WMDs apparently flow through fairly freely. Though the Kool-Aid Kids (and apparently others) do not see that contradiction, you do get the feeling that their heads are nevertheless threatening to explode, what with all the nasty contradiction build-up and stubborn reality-based pressure.
So we’re now seeing a cornered rat quality creep into their actions, as opposed to the once cocky swagger of post-9/11. The current desperation and savage aggression are a sight to behold, especially when compared to the milquetoast we've all forgotten that was georgie porgie prior to 9/11. The shifts – from wimp to chickenhawk to Codpiece-in-Chief to panicked rodent – have been both striking yet unsurprising, given the circumstances that have, er, presented themselves to these players. The, um, fortunate circumstances that have, well, by chance presented themselves to these, ahem, lucky players. That trifecta thang.
Though there may well be something similarly sinister afoot, as Joe suspects, it might possibly be something just as destructive but more pathetic in its reflection on these “lucky” players. It could be that this deal was pushed through simply because these fortunate sons owe the Dubai royals something. Hell, they gotta owe everybody out there something by now, and could be the UAE demanded payoff.
Of course, this take could be even more insidious, in that it could indicate these same royals are party to a real terrorist setup (as opposed to an inside job, or even a blind monkey job) that will lead to another attack, one that the desperately broke and indebted rats cannot think about just now because they are so preoccupied with domestic spying and Abramoff and Ken Lay and Libby and Cheney and legal funds and election campaigns and the “i” word and oh yeah Iraq and those godforsaken tanking poll numbers…. Could be these royals are no dummies and they figured all that out and decided to set up a strike while their enemy (that would be “US”) is down.
Now would that not be the irony to beat all ironies? We get hit again, but the entire world (maybe even Bush’s base) believes the neocons did it – because we won’t get fooled again, right? – except the reality is they’re innocent – of that, anyway – because they were so damned distracted by all the crimes they ARE guilty of, including their flagrant negligence and exploitation (at least) of 9/11, that they just could not imagine such a thing ever happening. Certainly not without their even knowing about it. And there they'd be, victims of their own blame game.
Just screams for a screenplay, don't it? I sure don't want it to be a documentary, considering the collateral damage involved.
So we’re back to that nagging question again, friends, but this time with the added element of their growing desperation: Just what will these scumbags stoop to in order to increase and hold onto their power? And do they really have time and money enough to keep up with all their craven little capers, half of which now must be spent covering up all their craven little capers?
dr. elsewhere
27 comments:
Actually, Paddy Chayevsky already wrote the screenplay for this. If you re-watch the film Network, it will jump out at you: Howard Beale gets TV news viewers to swamp the WH in telegrams to stop the CCI deal--which is an Arab consortium buying up, ultimately, the TV network in question... The deal is effectively stopped by his populist ranting. It is then up to Ned Beatty to explain to Howard Beale the bigger picture--that the dollars have LEFT the USA, and now have to COME BACK to the USA, because that is the ebb and flow of transnational money.
My personal take on the port deal is like Beatty's. We have sold our country to the Arabs and the Chinese, and now we're upset that they're taking possession of some of it--a few ports? Duh! Guess what! You don't get to keep the country! You sold it, remember? (And we're continuing to sell it off, at $3 billion per day.) It is the crime of all time.
(With apologies to Mr. Chayevsky and a hat tip to the Unirealist for the reminder):
"Whatchoo wanna do tonight, Unirealist"?
"For the one or two folks in the comments section who do not seem to grasp the importance of that contradiction, I'll spell it out here."
Don't know if you mean me (and "me" is a little ambiguous, since there's more than one "anonymous" in this universe of discourse), but except from Jed, I don't think anyone in the thread actually wants this company in the U.S.
There's a difference between pursuing the opposition's anti-terrorism arguments to their logical absurdity, and endorsing the Bush plan. The fact that Bush doesn't give a damn about terrorism when there's money to be made, or his vacation is at stake, is sad but irrelevant here.
If other countries start imposing the same requirements as we propose (only terror-free states get foreign contracts), then the U.S. will be kicked out of every country on earth.
Wow, unirealist, thanks for reminding me of that specific detail of why the "Network" was making personnel changes in the first place. Really a smack in the face to realize just how long this has been going on and how long it's been we've known enough about it to satirize it.
And I suppose you're right in principle that we have no right to demand to keep our ports when we've actually 'sold' them. But I think the outrage is not about that issue but about that the fact that THIS country, the UAE, just has such the wrong history to be getting access to our ports.
And anon, I'm not sure I was referring to anyone in particular with that clarification quote; it just seemed like the general discussion suggested the real point of the contradiction was getting lost in the shuffle. But perhaps I should let Joe speak for himself in terms of interpreting his point. My own interpretation is as stated above, and I do think the logic (or lack thereof) is extremely relevant here. The Bushies have garnered undue "political capital" by playing this terrorism card, and they cannot have it both ways, playing it to stay in power then dropping it to make money or pay off debt. No. And as Republican Rep. Sue Myrick wrote to Bush, HELL NO.
And hell yeah, if it means that the rest of the world stops doing business with us because of our history of terrorism, that would in fact be quite fine with me. Perhaps then the madness might stop. At least slow down.
And did we not pass some law that not only can US companies and citizens not do business with terrorist states, but the US cannot?
The UAE deal is just part of their overall plan. Pay attention to what they DO, ignore everything they SAY. They either say the exact opposite of the truth or they just blather convient nonsense to obscure and it changes daily. For an explanation:
http://www.informationclearinghouse.info/
article1544.htm
If you look at every action the admistration has taken, you note one consistent fact. No interest in defense or protection of the country from terrorism. All actions are about control of domestic dissent, information gathering on the American public, and theft of public funds. Why? there is no terrorist threat. They're not spending time worring about defense from their own psy ops. The free fall collapse of a steel building is structurally and physically impossible. Steel won't do it, physics won't allow it.
What WMDs?
The sale poses a huge threat to national security because all military cargo for Iraq flows through those ports and the UAE would control security for those ports:
"the sale would give a country that has been "a key transfer point for illegal shipments of nuclear components to Iran, North Korea and Lybia" direct control over substantial quantities U.S. military equipment."
http://thinkprogress.org/2006/02/20/uae-military-equipment/
UAE Would Also Control Shipments of Military Equipment For The U.S. Army
There is bipartisan concern about the Bush administration’s decision to outsource the operation of six of the nation’s largest ports to a company controlled by the United Arab Emirates (UAE) because of that nation’s troubling ties to international terrorism. The sale of P&O to Dubai World Ports would give the state-owned company control of “the ports of New York, New Jersey, Baltimore, New Orleans, Miami and Philadelphia.”
A major part of the story, however, has been mostly overlooked. The company, Dubai Ports World, would also control the movement of military equipment on behalf of the U.S. Army through two other ports. From today’s edition of the British paper Lloyd’s List:
[P&O] has just renewed a contract with the United States Surface Deployment and Distribution Command to provide stevedoring [loading and unloading] of military equipment at the Texan ports of Beaumont and Corpus Christi through 2010.
According to the journal Army Logistician “Almost 40 percent of the Army cargo deployed in support of Operation Iraqi Freedom flows through these two ports.”
Thus, the sale would give a country that has been “a key transfer point for illegal shipments of nuclear components to Iran, North Korea and Lybia” direct control over substantial quantities U.S. military equipment.
dr. elsewhere, thanks for your kind comment, as I wasn't clear on my point. Foreign central banks, mostly in the mid and far east, now own about four trillion of our dollars. Ergo, they own the USA, or at least a huge chunk of it. All they have to do is go shopping with their dollars. If they want, they can buy the Fortune 500. Or, all the farms in the USA. Or, all our mines and factories. Or, our ports, railroads, and airports.
In other words, we who live in America no longer own it. We still have the illusion that we own it because the real owners haven't yet taken possession.
But they will.
I hate the sale of our ports as much as anyone does. But we had better get used to this kind of thing, because our birthright has been sold out from under us, while half the country was yammering about the evils of abortion and drugs and homosexuality.
Our only real alternative is to overthrow our government and renounce our foreign debts. That would plunge the civilization into chaos. You pick.
Unirealist,
Source please. According to the U.S. Treasury, foreign holders of our debt own just over $2 trillion of our debt http://www.treas.gov/tic/mfh.txt
(compared to roughly $2.5 trillion held by U.S. citizens and $3.3 trillion held by SS trust fund) http://www.optimist123.com/optimist/2005/11/pie_chart_of_wh.html
Japan accounts for just under a third of all foreign debt holders followed by China and U.K., at roughly 11% and 10%, respecively. OPEC owns around 3%, which would give them enough to buy all of Target, but not enough to by Home Depot.
Hate to say it, but I believe Jed is correct this time around.
"Foreigners" still hold a large portion of the U.S. patrimony -- largely so that Ronald Reagan and GWB could give the "haves and have mores" [Dubya's language] huge tax cuts -- but the U.S. will "manage" this debt by devaluation. If any foreign interest actually tried to cash in its chips, its "trillions" would shrink dramatically.
In effect, they're subsidizing their own exports. It may be short-sighted, but they don't have much choice -- there's nowhere else to sell their goods.
Anonymi, I believe you're living in fantasyland. The federal debt is 8.2 trillion, about half of which (if I'm not mistaken) is now foreign-owned. I will source that as soon as I can. But consider: the trade deficit for 2005 was 725 billion. Use common sense here. It has been steadily rising, but a decade or so would put the USA in a four trillion hole. I am amazed anyone reasonably aware of the financial state of the USA would question my point, but all right, I will return ASAP with precise figures and sources.
Anonymi, try this"
http://www.financialsense.com/editorials/hodges/2005/0412.html
Taking into account goods and services and investment flows, which is called the current account—"foreign-owned assets in the US totaled US$9.4 trillion in 2001 while US claims on the rest of the world amounted to US$7.2 trillion," according to the White House Council of Economic Advisers—meaning a net $2.2 trillion deficit with other nations as of 2001. Adding to this negative the combined current account deficits of $1.64 trillion for 2002, 2003 and 2004 sums to nearly negative $4 trillion against the U.S. in favor of non-U.S. entities.
Okay? But I'm not done yet...
Oh, yeah... that would make 4.725 trillion, if you count 20005. I guess I understated.
...and, from Richard Daughty:
"...Mr. Schiff is also speaking of money when he writes, "This year alone America's current account deficit is likely to be $800 billion. To put this number in its proper perspective, $800 billion is equal to the combined market capitalization of the following fifteen Dow Jones companies: Alcoa, American Express, Boeing, Caterpillar, Coca-Cola, DuPont, General Motors, Hewlett-Packard, Home Depot, Honeywell, 3M, McDonalds, Merck, SBC Communications, and Walt Disney. In other words, to finance just one year's purchases of consumer electronics, granite counter-tops, vacations, automobiles, furniture, appliances, clothing, toys, and net interest and dividend payments, Americans will basically give away the equivalent of half of the companies that comprise the Dow Jones Industrial Average." Half! For one year's worth of imports! One!"
From Peter Schiff, the financial consultant. Sorry I can't find that actual link. It's an eye opener, eh? I can pound you all day with these statistics, I think.
Unirealist,
When you include trade deficits as part of American indebtedness, the picture gets muddied. Some, but not all of this outlay, represents borrowing from foreign sources. Much of it also reflects over-valuation of the dollar (though the consequences of a "true" valuation wouldn't be pleasant for the U.S.). And there's no particular advantage to American working people if you buy your electronics from an American-based corporation who makes the equipment in China, or a Japanese company which makes the equipment in Korea.
Of course, if a country buys everything from abroad and makes nothing, it's on the road to impoverishment.
But, for the sake of this discussion, I thought we were talking about who holds American treasury securities.
There's no disputing your fundamental point that America is in hock to the rest of the world. But "they're" also in hock to "us", because of the enormity of their dollar-dominated investments.
For the most part, they don't own our gold or our resources -- they own our dollars in the form of Treasury bonds. Unfortunately for them, it's impossible to cash out. If they try to sell, they'll take huge losses. Or if the U.S. undergoes a financial crisis, it will effectively devalue the dollar, and the bonds will be worth much less than what they bought for.
Again, this isn't to defend U.S. economy policy, or the state of the economy.
Finally, it's not surprising that "foreigners" own more of our economy, than we own of theirs. Ours is a very large economy, with an avid consumer section, and (for better or worse) it encourages investment with a host tax incentives. At least until recently, many people wanted a piece of that economy. We are, after all, the home of the world's reserve currency and only super-power. It's a much dicier matter to invest in China or India and, until recently, nobody wanted to invest in Japan.
Anonymous... Asian central banks now own 2.6 trillion in Treasuries. That's Asian alone.
Your point that they cannot dump those dollars without triggering a freefall in the dollar's value is valid, but gives no comfort. All the depositors in a bank can know that not everybody can get their cash out at once, but that is no guarantee there won't be a bank run.
Your position is mystifying. Do you think that the US invented this kind of deficit spending? It didn't, and every nation that has tried it previously in history has ultimately lost its government, by conqest or revolution. Surely you don't think we will somehow be different?
Anonymous..
Here's a source on the net US debt:
http://www.rgemonitor.com/blog/setser/91472
Also, according to the latest issue of the Washington Spectator,
"At the end of the third quarter of 2005, Americans owed the outside world $4.3 trillion more than the outside world owed Americans."
The USA was a net creditor until the early 1980's. Since then, the net debt as a percentage of our GDP has risen rapidly, and is now at 30%.
These deficits are unsustainable, and dire warnings are being issued by credible authorities, like the current US Comptroller, and even Greenspan himself. I can source these if you like.
This government is doomed. The only question is what comes next. Will it be fascism, like 1930's Germany, or a Jacobin/Bolshevik revolution, like France or Russia.
You pick.
Unirealist,
Asian central banks may have $2.6 trillion in currency reserves - but according to Bloomberg that's in all currencies, not just U.S. treasuries. In the same column, the author states that of China's $819 bn in currency reserves, about $250 bn are in U.S. treasuries - which matches the information I provided earlier - that China holds about 11% of foreign-held U.S. debt.
As for deficit spending, as a percent of GDP, the deficit is in line with post WWII levels. The absolute size of the deficit is not very meaningful without putting it in context of the absolute size of GDP.
http://www.iht.com/articles/2006/02/19/bloomberg/sxpesek.php
You are confusing debt and the current account deficit. They are two very different things.
According to wikipedia, foreigners held 44% of the debt held by the public , this does not include the debt in the SS trust fund or other government accounts, and again matches the information I provided earlier. And debt held by the public was 37.2% in 2004 (slightly higher in 2005). Since 1985, the lowest years on record (in order) are: 2001, 2002, 2000, 2003, 1985, and 2004.
http://en.wikipedia.org/wiki/U.S._public_debt#Consequences_of_foreign_ownership_of_U.S._debt
http://a255.g.akamaitech.net/7/255/2422/07feb20051415/www.gpoaccess.gov/usbudget/fy06/pdf/spec.pdf
Top fiscal watchdog delivers stinging attack on deficit
Friday, January 23, 2004
WASHINGTON --The U.S. comptroller general, David Walker, laid out a blistering attack on the nation's growing deficit yesterday, saying it is undermining the future of the nation and putting an all-but-intolerable tax burden on future generations.
"The path we're on is imprudent and unsustainable,'' he said.
...In a session with reporters, Walker, who also heads the General Accounting Office, the non-partisan watchdog arm of Congress, said he has become convinced that neither the Bush administration nor members of Congress nor the public understand how serious a problem the nation's public debt and rising deficit are becoming.
If foreign investors decide that they don't want to hold U.S. debt anymore, it could be catastrophic, he said.
(and...)
Greenspan Says Federal Budget Deficits
Are “Unsustainable”
New York Times
March 3, 2005
Alan Greenspan, chairman of the Federal Reserve, warned on Wednesday that the federal budget deficits were "unsustainable," and he urged Congress to scrutinize both spending and taxes to solve the problem...
... The assessment was Mr. Greenspan's gloomiest to date about the government's budget straits. Unless Congress takes major action to reduce the deficits, preferably, he said, by deep cuts in spending, annual budgetary shortfalls will continue and closing those gaps will become even more difficult...
Though Mr. Greenspan has made similar pleas in the past, he spoke more urgently on Wednesday and disagreed more adamantly with Republican lawmakers and Mr. Bush, who have steadfastly refused to put restrictions on new tax cuts.
Unirealist,
I'm not sure what Jed's ultimate argument is here (I don't think it's the same as mine), and his assertion that deficits are running at WWII levels, as a percentage of GDP, is hardly comforting. If this is Republican economics, what would happen if we were fighting a *real* war?
For my part, however, I'm not arguing that the U.S. economy is in good shape, or that we're not on the road to ruin.
The question, as I understood it, was the power of "foreigners" over American affairs, thanks to their "ownership" of American assets. The trouble here is that if they own dollars, in the form of treasury securities, they don't really own anything of value, if and when the crisis arrives. They can't buy up the American economy with this money.
Finally, no one is "buying" the ports, and the ports aren't for sale. All we're talking about is the managing agent. We're hiring them, they're not hiring us.
Yeah, things are terrible. But the fungibility of money calls into question the issue of what constitutes a nation. Would it really be better if General Motors or Microsoft held American Treasury notes, rather than China or Japan?
I'm just trying to say that foreign ownership isn't the real problem. If China and Japan stopped buying, interest rates would go up, and American institutions would start buying. But what would that solve? The fundamentals would be the same.
Just as a second thought, to that prior post: IF "foreigners" decided to make equity investments in this country with their trade surplus dollars, rather than buy Treasury securities, THEN they would indeed own the American economy -- stocks, real estate, ports, airports, natural resources etc. -- within a relatively short time.
And a third thought, for what it's worth: as already noted here, foreigners own about $2.2 trillion in U.S. debt (out of total of about $8 trillion), plus a good amount of stock (13%), corporate bonds (25%) and agency securities (33%).
However, look at this figure: household debt alone in the U.S. is OVER $10 trillion.
Whether owing money to China is better than owing it to Visa and Citibank, I couldn't say.
. . . deficits are running at WWII levels, as a percentage of GDP, is hardly comforting. - imprecise language on my part. I meant the average deficit as percent of GDP since WWII, which has been 1.7%. Excluding WWII, the average since 1930 has been 1.9%. During WWII, the U.S. was running 20%+ deficits. In 2005, the figure was 2.6%.
I'm not really sure what the large nominal household debt figure is supposed to be indicative of. Credit access has expanded tremendously over the past fifty years. If people have student loans or mortgage loans outstanding because they have greater access to credit now than they did before is that a bad thing? Using debt to buy an asset that yields more than the rate on the debt is a perfectly rational decision. Using debt to buy a flat-screen HDTV - well that's a different story, but don't worry, because Social Security benefits aren't going to be cut.
m. jed. and anonymous...
1. The deficit is running at almost 6% of GDP. The Gross National Debt is growing at $676 billion/year.
2. I am not confused about debt and current account deficit. And, although they are two different things, they are closely connected. It is surplus dollars earned in trade with which foreign nations purchase our debt. In fact, if the US were itself still running a current account surplus, foreign nations would be unable to purchase our debt. To deficit spend, we would have to borrow entirely from US citizens, or crank up the printing press and monetize the debt...
...
3. Deficit spending by the US is now soaking up something like two-thirds of the savings of the rest of the world. The percentage is steadily growing, and projected to reach 80% by 2010. Ultimately, the US will be borrowing 100% of surplus savings in the world. How will the Ponzi scheme be kept up after that?
4. The accumulation of debt is okay only if the borrowed dollars are used for capital investment. That is not what the US is doing. The US is borrowing 2-3 billion a day just to keep the federal gov't running. If all these debts were internal, an argument could be made, as it was years ago, that we owed the money "to ourselves", but that isn't the case.
5. Even if foreign central banks have a vested interest in keeping the dollar afloat, they control us because of our indebtedness. Really, if China wants to seize Taiwan, are we going to try to stop them? All China has to do is dump its dollar reserves, and the US is done for.
6. The real reason that the US has been able to run such huge deficits without the dollar's value collapsing is that oil is internationally priced in dollars. Once that changes, as it will soon (Iran's new bourse), not even intervention in currency markets by foreign central banks will be able to prevent the dollar from plunging.
I hope you all are preparing for what is coming. Thanks for the spirited and polite exchange of views.
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