The Biggest Banana Republic

The good, old US of A under Obama, et al:

…Many economists and analysts are worrying that the United States might go the way of Japan, which suffered a “lost decade” after its own real estate market fell apart in the early 1990s. But I’m more concerned that the United States is coming to resemble Argentina, Russia and other so-called emerging markets, both in what led us to the crisis, and in how we’re trying to fix it.

Over the past year, I’ve been getting Russia flashbacks as I witness the AIG debacle as well as the collapse of Bear Sterns and a host of other financial institutions. Much like the oligarchs did in Russia, a small group of traders and executives at onetime venerable institutions have brought the U.S. and global financial systems to their knees with their reckless risk-taking — with other people’s money — for their personal gain.

Negotiating with Argentina’s top officials during their multiple financial crises in the 1990s was always an ordeal, and sparring with Domingo Cavallo, the country’s Harvard-trained finance minister at the time, was particularly trying. One always had the sense that, despite their supreme arrogance, the country’s leaders never had a coherent economic strategy and that major decisions were always made on the run. I never thought that was how policy was made in the United States — until, that is, I saw how totally at sea Treasury Secretaries Henry Paulson and Timothy F. Geithner and Federal Reserve Chairman Ben S. Bernanke have appeared so many times during our country’s ongoing economic and financial storm.

The parallels between U.S. policymaking and what we see in emerging markets are clearest in how we’ve mishandled the banking crisis. We delude ourselves that our banks face liquidity problems, rather than deeper solvency problems, and we try to fix it all on the cheap just like any run-of-the-mill emerging market economy would try to do.

We are, as I’ve said before, broke. And I mean that – we’ve not got a cent left to our national name. Blame it on Bush, if you like. Heck, blame it on the banks; on the government…blame it on little, green men from Mars, if you’ve a mind. Doesn’t matter whom you blame – the fact still remains: we’re broke.

What does it mean to be broke? It means we have obligations in excess of our assets. In our case, our obligations are massively larger than our assets – and Obama wants to increase the obligations in the hopes that by spending money we don’t have, we’ll end up to the good at the end of the day. Yes, I know its stupid – but its in line with the most brilliant liberal thinking. No, really – the people liberals consider geniuses swear by this. If we’re flat busted now, we’ll be squishy flat busted if we go with Obama’s plan.

What to do?

Stop spending more than we make. I know, who would think of such a radical, untried idea? But, bear with me here: there is method to my madness. You see, if we spend less than we make, then each year we’ll owe less and less money and, eventually, our assets will exceed our liabilities and we’ll no longer be broke. Might take a while and it might take a lot of hard work and sacrifice, but it can be done – we can live on our income, if we just try.

How do we spend less than we make? By stopping all spending not necessary for the safety and health of the American people. Sorry, NPR. Sorry, NEH. Sorry, Department of Commerce. Sorry, Department of Education. Sorry, Department of Labor – but some things just have to be laid aside for a while. We’ll also have to do without grants to ACORN and we won’t be able to afford the Obama Jugend. I know, its disappointing we won’t have mindless, leftist robots around to spy on us, but it is just one of those sacrifices we’ll have to make. We’ll also not be able to go into socialized medicine, and welfare will have to be tightened up considerably to ensure that its only going to those who are unemployable or unemployed through no fault of their own. In short, we’ll just have to get by with defending ourselves against foreign and domestic threats as well as ensuring that no one starves, is un-housed, is un-clothed or lacks the very basics of medical care. Trust me on this, boys and girls, we can tough it out.

If we do this, then we’ll eventually be a quite rich nation, again – you see, we have vast resources, most of which remain untapped. We must get going on making, mining and growing things and by so doing build up the wealth to pay off the debt we accrued during those years we figured that shuffling paper around was a worthwhile activity. If we don’t do it? Then we’ll end up in complete economic collapse and perhaps political breakdown.