March 22, 2006

A lot of rubbish has been written about "religious faith" lately. The fact is, there’s a force more powerful than faith; the power of denial. America has completely surrendered to denial; abandoning any claim to reason or clear-sighted analysis. The vast majority of people are perfectly content to ignore the tell-tale signs of looming disaster choosing instead to keep their heads firmly tucked in the sand.

Is it really that hard to see what’s happening?

Is it difficult to grasp that the Congress just voted to spend another $92 billion for a war that nobody wants? That raises the national debt to a whopping $9 trillion, every penny of which will be paid off by our children and their children’s children. They’ll be indentured servants until the end of time.

Do the American people care? No way. The soothing bromides from our doltish president are enough to lull them back into their narcotic-haze.

It’s called "denial". D-E-N-I-A-L.

Turn off the propaganda "business channel" and do some independent research. If you’ve already figured out that the Bush administration is fudging the numbers to make them look good; you’re right. Walter J. Williams (Dartmouth, BA in Economics and an MBA; economic consultant for Fortune 500 companies) has compiled the data and found that "real unemployment is running at 12%, real CPI (Consumer Price Index) is running at 8%, and real GDP (Gross Domestic Product) is in contraction. Most people know intuitively that things are bad, they just can’t see passed the government smokescreen.

No one with half a brain believes this can go on forever. The Bush administration has racked up another $3 trillion in debt in just 6 years most of it going to Bush’s well-heeled friends via the "tax cuts". Now, the Congress has voted to make the tax cuts "permanent" even though they are certain to increase the deficits by $400 to 500 billion per year. Deficit spending has become a permanent function of government….but why?

And, why haven’t the deficits caused skyrocketing interest rates like they did when Reagan was president.

It’s simple, because of the trade deficit.

When Reagan initiated his tax cuts he produced deficits of $200 billion the first year. That pushed interest rates up to 9.5% killing the real estate market and causing the deepest recession since the Great Depression. Greenspan bailed him out by raising Social Security payments (under the ruse that SS was "broken") and then diverting that new money into the general fund. (SS has basically been a Flat Tax ever since) That’s right; your Social Security dollars now pay for roads, social programs, and endless war.

Now we have $400 billion deficits but interest rates stay low? Why?

Well, it’s mainly because of the trade deficit which soared to $725 Billion last year and is headed towards $800 billion this year. That explains why foreigners can afford to buy our ports, because they’re holding so much American debt (dollars and securities) China alone has over $800 billion account surplus approximately 75% of which is US debt and securities.

The Bush team is just fine with this arrangement because they are all globalists who want to see the nation’s sovereignty transferred to the multinational corporations. (Hence, Bush’s insistence on the Dubai port deal) As for the rest of us , who believe that our ports, public lands, water, and resources should be the sovereign property of the people of the US, well, we’re out of luck , because $3 trillion worth of those assets and resources now belong to China, Japan, and Saudi Arabia. And, they were sold right out from under our noses while government toadies were waving the flag of "free trade" in our faces.

The other reason the American people haven’t felt the pinch of excessive government spending yet, is because of the unique relationship between the greenback and the sale of oil on the global market. Countries are forced to keep stockpiles of US currency in their central banks to purchase oil because oil (the largest commodity in the world) is only denominated in dollars. This creates a de-facto monopoly which ensures that dollars will continue to circulate on a massive scale whether the face value of the greenback goes up or down. (It is estimated that approximately $2.3 trillion are constantly circulated in oil transactions) It is basically the perfect con-game run by the hucksters at the Federal Reserve.

Would countries rather buy oil in their own currency or with the euro which has increased by 32% in value since Bush took office?

Of course, why would anyone choose to use a currency backed by $9 trillion of debt? Regrettably, any move to the euro would be accompanied by a "shock and awe" military invasion by the guardians of greenback-supremacy in Washington. This is why Iran is in the crosshairs right now, because they have threatened to open an oil exchange (bourse) that would trade in euros and challenge the dominance of the dollar. Bush cannot afford to let Iran discard the greenback and allow the central banks to sends boatloads of unwanted dollars back to America. The surplus would send the dollar into a death-spiral; ensuring recession at home.

The bottom line is this, America’s economic future requires that we continue to control this "global extortion-racket" (aka; the dollar-monopoly on oil) while producing the humongous trade deficits which are mortgaging our country to foreign lenders.

There’s only one problem with this scheme; the American consumer is broke. Wages have been flat since the 1970s (in fact they have gone down by 2.3% since Bush took office) personal savings are at 0%, and housing prices (which generated $600 billion in additional spending last year) have flattened out. The American consumer represents 70% of GDP and has also been the major engine for growing the global economy. Unfortunately, he’s "tapped out", broke, overextended and busted.

That explains why so many corporations are packing up and headed for more promising markets in Southeast Asia. Hell, the Bush administration has even created tax incentives for them to leave.

The corporate exodus from America is not simply about high-paying, high-tech jobs evaporating. It is also about the massive flight of capital, the exiting of corporations, and the destruction of the manufacturing sector. Right now, the only thing that keeps the US on its precipice is the teetering housing market that is headed for the dumpster. When that unravels, we’ll see why Bush devoted so much energy putting together the nascent American police-state.

So, what’s the Bush plan?

Well, what you see is what you get. The major corporations have already loaded the boats, shifted the jobs, and drained every farthing from the public till. The Bush team has set up NorthCom (Northern Command) inside the country to deal with any needless unruliness on the part of the masses once they discover the country is dead broke; and the Federal Reserve has cobbled together a dollar-system that allows them to print worthless script in exchange for the wealth and resources of foreign nations. This allows Bush’s parasitic-class of bankers, oil magnates, and defense contractors to live large on the sweat and labor of the poorest workers on earth.

Sounds like a plan.

This is why we fight; to defend this system of calculated theft. This is the "noble cause" behind the war in Iraq; to preserve the global extortion-racket we call "dollar hegemony".

Now, someone please tell Cindy Sheehan that’s why her son died.

Courtesy and copyright © Mike Whitney