Rest of world gets sick of propping up Bush's deficit

[rooboy]

.....
If, or when, the rest of the world decides to stop funnelling the $US2 billion per working day that the US needs to pay for its spending, Henry says we're all in for "an economic adjustment of major proportions".

American interest rates would skyrocket and the greenback would drop like a stone, for starters, which is why Henry argued so hard for the Reserve Bank board to drop interest rates pre-emptively this year.

One of Henry's colleagues on the Reserve Bank board, Warwick McKibbin, is not concerned about the quantum of America's record 5 per cent, $US500 billion current account deficit, but he is very worried about its composition.

An ANU economist and professorial fellow at the Lowy Institute, Professor McKibbin is doing the sums on the incomprehensibly large $US7000 billion in tax cuts and security spending - 10 times Australia's annual economic output - that has been lumped on to America's 10-year deficit projection since Bush's election three years ago.

His modelling concludes that the deficit "explosion" would leave the US economy "unambiguously worse off in the medium and long term".
...

http://www.smh.com.au/articles/2004/01/04/1073151209953.html

[ithacan]

1. they're really wrecking the US economy!!

This is yet more evidence that the Bushies will stop at nothing to retain power in the short term, until they have time to totally rob and plunder the American people....

He estimates that the US fiscal deficit will depress American equity markets and lop 6 per cent from GDP within 10 years.

On the plus side, his modelling shows investor "flight" will boost growth in the rest of the world because their money would be redirected.

[pretzel4gore]

2. government by vandalism...

the righteous have figured out how to do it...and the news media has helped alot....destroying the carefully built up infrastructure of social safety and prosperity.
if one hates america, then 'go bush!'
it's almost too incredible to believe....the worst imaginable gang of murderers CONSPIRING with those who are entrusted with (giving form to the idea of) the nation's well being....lol
karma is obviously at work!

[maha]

3. kick n/t