Good Luck To Americans (They're Going To Need It)

It's not too hard to see what kind of trouble you're in when your budget deficit is 20% of your total budget. Is this the same US government that is running the IMF and World Bank to make every other country run balanced budgets?

The US dollar is headed for the toilet if congress doesn't reign Bush in and insist that he collect enough taxes to pay for good government. Bushanomics are more voodoo than Reaganomics; both basically being based on the assumption that if you let rich people keep more and more of their money they will make the economy grow.

Only trouble is whatever the rich are going to buy they have already bought and the average person is making up for foregone tax revenues from the wealthy and can't afford to buy anything other than what they need to live on, which they would buy anyway. Of course the other side of Bushanomic/Reagonomic argument is that the rich will invest their increased savings. Two problems with this. One, America is awash in investment money already, and if you don't believe it, look at all the credit card offers to transfer funds at 1.9% interest (the banks would rather earn 1.9% than have money sitting there doing nothing). Second, virtually all of these tax savings will go to buy pre-existing stocks and such that do not provide any actual investment dollars to the company but a mere exchange of money between two investors. Even if it did actually go directly to business investment it would be a short-term solution at best because of the first point above.

Excellent analysis hoopoe. Trickle down economics is complete fantasy.

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Canadians are asking, why do americans hate us? They hate our freedoms: our freedom of religion, our freedom of speech, our freedom to disagree with each other.

The real test to Bush's version of supply side economics will be the US National debt that is increasing at $2.56 Billion per day ( nearing 7.6 Trillion or $26,000 per citizen). Shades of Argentina and Mexico but if the Americans default it wouldn't have nearly the same impact on international markets because of reliance on domestic lenders.

Tommy Douglas compared trickle down economics to feeding birds by giving oats to horses. Eventually the birds get some seed but is covered in a lot of sh*t.

Not to mention that the movement in the American economy has been for the last few years based almost entirely on credit spending. Consumer debt has never been as high in the US as it is right now and that too can come back to haunt them. Already this week there are reports that there is expected to be record bankruptcies and mortgage defaults because of the most recent interest rate hike there. They cant raise interest rates too high or the American home owner and consumer will suffer because of the increase in payments, and they cant afford not too because of their sagging dollar and bond devaluations. they are caught in the middle with only way out - raise taxes on all levels - especially the rich. Well they could also stop making war on others and scale back their military, but none of those outcomes are likely with Bush and team in office.

One last thing - reading over at freeper land that they are STILL blaming clinton for their economic troubles. One poster tried to explain that it has been four years since Clinton, and that he left great surpluses of money behind, but they all ignored fact and went for the usual clinton/liberal bashing instead of looking at the real cause - Bush's failed rightwing economic policy to reward the rich, and only the rich.