Welcome to European Tribune. It's gone a bit quiet around here these days, but it's still going.
It starts as another fantasy world piece that imagines that the US would be better off mired in a deep rather than a shallow depression, since a deep depression is what we would have got from full-on Coolidge speculation followed by full-on Hoover fiscal policy in response to the Panic of 2008.

And the elephant in the room, the fact that the US consumes 1/4 of the world's oil supply, and imports twice what we produce, completely ignored.

But then it slides toward reality, since the military spending includes such a major contribution to the US trade deficit, and its the trade deficit that causes the capital inflows from overseas, no the government deficit.

If we spent the same $1T on things that would reduce our trade deficit by as much as $1T in military spending will increase our trade deficit, it would be a budget deficit very well spent indeed.

I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.

by BruceMcF (agila61 at netscape dot net) on Thu Nov 25th, 2010 at 01:22:03 PM EST
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