Not a day too early? Cautious.
A day later? Clever; It may OVER by then.
Congressman Ron Paul compares our debt ceiling Bunraku with the following situation:
This is akin to a family "saving" $100,000 in expenses by deciding not to buy a Lamborghini, and instead getting a fully loaded Mercedes, when really their budget dictates that they need to stick with their perfectly serviceable Honda[...] Our revenues currently stand at approximately $2.2 trillion a year and are likely to remain stagnant as the recession continues. Our outlays are $3.7 trillion and projected to grow every year. Yet we only have to go back to 2004 for federal outlays of $2.2 trillion, and the government was far from small that year. If we simply returned to that year's spending levels, which would hardly be austere, we would have a balanced budget right now. If we held the line on spending, and the economy actually did grow as estimated, the budget would balance on its own by 2015 with no cuts whatsoever. We pay 35 percent more for our military today than we did 10 years ago, for the exact same capabilities. The same could be said for the rest of the government. Why has our budget doubled in 10 years?Now, who's the audience? Surely US. Outside the US, there might be those who'd still point out how responsible we are even when evidence suggested otherwise. Yet I have a feeling that the monied outsiders are not buying in and, to get a bit speculative about it, I'd not be all surprised if Mr. Murdoch followed his doctor's advice and took up residency in some warmer and humid climate, as in HK if you get my drift.
Here in the US we are well on our way to the structural adjustment I keep talking about, e.g., here, yet the latest Bunraku play in discussion shows that the burden won't be share equally, which can make the situation very volatile. The progressive left has been administered its 'leave politics for the lowly!' signal, now it's the turn of the Tea Party folk to be sent packing. Also here, as no bubble is in sight, the hope might well be that portions of the rest of the world would be become so much worse, and the more their difficulties are denominated in dollars the better, that we couldn't look so bad in comparison. So there you have a type of OVER. There could be many other types of OVER, but the fabricants of reality and money must have become so sure of their craft and our confusion that they are banking it all on the first kind of OVER. For the individuals not associated with these schemes there is only one way to see the light, get back to the fundamentals! Yup, those we've been conditioned to scorn. In case you don't know where to start, pick up any wise text that had been written more than, say, 100 years ago. Then, after internalizing some of that stuff, join conversations, talk back!
Ron Paul for President, 2008, originally uploaded by jshj.
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The stock market has started... adjusting. The Debt Ceiling was only a step, cuts will be the next steps. Stock values reflect future earnings. They know it ain't pretty. Neither is war. But how else to secure resources and redirect public attention/outrage?
The Right Way to Trim
By JOSEPH S. NYE Jr.
Cambridge, Mass.
THE recent debt deal will slash the defense budget over the next decade. And if Congress can’t agree on an additional $1.5 trillion in cuts, the law’s “trigger mechanism” will lead to deeper reductions in military spending. The initial cuts will not imperil America’s national security, but the deeper cuts could.
The administration of George W. Bush nearly doubled the defense budget following 9/11. With the winding down of Mr. Bush’s two wars, we could cut our ground forces to 1990s levels, reduce the planned purchases of F-35 Joint Strike Fighters, make greater use of cheaper drones and other technologies, and deal with the escalating costs of the defense health care system — without serious damage to national security. Indeed, President Obama’s budget had already planned for $400 billion in defense savings by 2023.
But it is not enough to tinker with the defense budget. We also need to rethink how we use our military power. Unlike the state of affairs during the cold war, the United States and its allies today account for over 70 percent of world military expenditure. The No. 1 power no longer has to patrol every boundary and seek to police every country. Opponents of defense cuts are raising the specter of isolationism and the weakening of American power. But there is a middle way.
At the height of the cold war, President Dwight D. Eisenhower decided against direct military intervention on the side of the French in Vietnam in 1954 because he was convinced that it was more important to preserve the strength of the American economy. Today, such a strategy would avoid involvement of ground forces in major wars in Asia or in other poor countries. While it will take time to extricate ourselves from Mr. Bush’s post-9/11 strategy, we must start, as the National Security Strategy of 2010 states, “by recognizing that our strength and influence abroad begins with the steps we take at home.” Eisenhower could have said that — and no one could accuse Ike of being an isolationist.
Counterinsurgency is attractive as a military tactic but it should not lead us into a strategy of nation-building in places where we do not have the capacity to engineer change. The maxim of avoiding major land wars in poor countries does not mean withdrawing our military presence from places like Japan and South Korea, or ending military assistance to countries like Pakistan and Egypt. Some analysts call this “off-shore balancing,” but that term must mean more than just naval and air force activity. For example, in Japan and South Korea, our allies pay a significant portion of the cost for basing American troops there because they want an insurance policy in a region faced with a rising China and a volatile North Korea.
Over the course of this century, Asia will return to its historic status, with more than half of the world’s population and half of the world’s economic output. America must be present there. Markets and economic power rest on political frameworks, and American military power provides that framework. Military security is to order as oxygen is to breathing: underappreciated until it becomes scarce. That is why the new bipartisan Congressional commission must provide the revenues that allow America to continue to play this vital role while avoiding the trap of overly ambitious nation-building.
Such a strategy is also sustainable at home. The British historian Niall Ferguson, an enthusiast for empire, lamented at the time of the Iraq war that the United States lacked the capacity for empire because of three domestic deficits: personnel (not enough boots on the ground); attention (not enough public support for long-term occupation); and financial (not enough savings and not enough taxation relative to public expenditure). He was correct.
Lacking a stomach for empire or colonial occupation is one of the important ways in which American political culture differs from that of imperial Britain. Americans like to promote universal values. But rather than succumbing to the temptation to intervene on the side of “the good,” we can do it best by being what Ronald Reagan called “a shining city on a hill.”
The alternatives we face today are not an untouchable defense budget or isolationism. A smart strategy for preserving America’s power and global role will depend on wisely tailoring our foreign policy to fit the cloth we have. Eisenhower knew this well.
For a (very) long time now (actually about 20+ years) I have been (increasingly) convinced that our Anglo-Saxon culture/social contract is inherently unable to get it right as far as healthy and the majority of population benefiting solution to healthy economy (thus society) is concerned. Like our British cousins after WW2, we are deeply, deeply in debt, living off (at last) shrinking free ride of having the monopoly on printing world's 'reserve currency'. Our version of capitalism (as compared to continental/German etc. capitalism) is running out of its competitive edge. There are no colonies to be conquered (and Iraq etc. only proved the same), no land to grab at the Wild West, no dirty cheap natural resources to exploit (as China and others are coming to the table). Unlike Germans, we are taught to parrot that government is no good, that individualism is the G*d. Our ideology prevents us to have educational and modern workforce training systems, some corporate priorities and sound governmental policies aligned (like in Germany etc.) so that we can't (unlike Germany) make and export enough high value-added TANGIBLE products that the rest of the world is willing to buy. When I am asking our economic faculty, Wall Street wizards, etc. how Germans can do all this plus carry a huge cost of reunification and strong euro, yet still export (almost) as much as another (15-times larger) export machine, the Peoples Republic of China, they have no answer as they are prisoners of our prevailing ideology. Obama’s daughters will not study engineering, nor will almost any middle class children. Finance, marketing, ‘creative writing’ will no longer provide standard of living we expect.
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