Posted on Friday, January 23, 2004 - 10:44 pm:

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Unfortunately, Clinton was in no way responsible for creating jobs, especially in the private sector. The Bush administration will be directly responsible for creating such jobs.

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Posted on Saturday, January 24, 2004 - 10:23 am:

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Treasury statistics indicate that foreigners bought 58 percent of the securities that Treasury sold to investors. Some 60 percent of that 58 percent was bought by central banks. A large percentage of that went to the central banks of Japan and China. This exposes the United States to financial or political risk that either bank will stop buying Treasuries - or selling them heavily.

This is seen as a very substantial risk by some who study geopolitics and creditary economics.

Another risk of possibly even greater magnitude is the possibility that OPEC will begin to price oil in Euros, as Saddam Hussein began to do in 1998 - until this decision was reversed by the 2003 invasion of Iraq. According to economist Henry K. Liu, the 'float' achieved by the necessity of all industrial nations needing to keep a U.S. dollar reserve to hedge against rising prices of oil, is also numbered in trillions of dollars. A shift to a different reserve currency shifts that float as well, and sends those saved dollars back to U.S. shores to be redeemed for goods. This causes inflation, rises in interest rate, and increases in bankruptcy as obligations and assets are called in, to increase flow of cash or goods to the offshore buyers redeeming dollars.

The impact of this would likely be to make U.S bonds have to rise in rates to appeal to investors in a thinner market - which would trigger inflation all over the industrialized world, given the central position of the U.S. in it. A round of hyper-inflation is possible that would potentially break Bretton Woods institutions capacity to react. This would be a larger scale repeat of the George Soros attack on the British pound sterling that broke the EU fixed rate exchange system and forced creation of the Euro.

Every dollar of increased U.S. public debt, and every rise in interest rates, and every shift in pricing of a major industrial commodity, decreases the cushion available, and increases the potential that the U.S. might default on its own bonds. This would likely mean that U.S. dollar savings would be worth drastically less. Far-fetched as this seems, it happened in Argentina when International Monetary Fund-required measures forced an economic austerity regime that was widely blamed by economists as leading to a meltdown in its currency.

Far more serious than either of these questions, which involve 'only money', is the question of the triple bottom line which is the financial, social and natural debt created by exploiting systems with an internal integrity, drawing on them as if they were free. Financial capital is not in general a good guide to social or natural capital flows, and many economists claim it is a contrary - even inherently contrary - process. See uneconomic growth for this discussion in detail.

A serious failure in accountability for instance causes loss of social capital which decreases trust essential to commerce and polity, while loss of natural capital causes a reduction in nature's services (such as irrigation or flood control) that must then be made up for by human effort, stressing the human economy. There are no economists who claim that the financial debt or deficit is actually independent of these factors, and very few who claim that economic growth indicators or measures of national income work well enough to rely on them utterly.

Thus, the ultimate political risk: collapse of an entire polity, which happened for instance in the collapse of the Soviet Union, or rise of a wholly different political economy, as happened after hyper-inflation in Weimar Germany, with the rise of Nazism.

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