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The American Empire Is Bankrupt
June 18, 2009 11:36 AM   Subscribe

The American Empire Is Bankrupt (via The Agonist)
posted by Substrata (81 comments total) 10 users marked this as a favorite

 
Key to successful Imperialism: Don't blow all the money on a Death Star.
posted by Sys Rq at 11:44 AM on June 18, 2009 [22 favorites]


I haven't gotten very far in the article, but I do find it interesting how much traction the notion of "American Empire" has gotten recently. I remember it being spoken of in the 80's and 90's, but the people who used the term were generally dismissed, at best, as cranks. Now it's getting main-stream media play, without irony or sarcasm.
posted by lekvar at 11:47 AM on June 18, 2009


So, if I understand the argument correctly, the U.S. is now faces a situation where we have a ridiculously well-funded military — not to mention an apocalyptic arsenal of nuclear weapons — but not enough access to basic materials and resources.

Are you thinking what I'm thinking, Pinky?
posted by Kadin2048 at 11:48 AM on June 18, 2009 [7 favorites]


What does it matter that trade is denominated in yuan rather than dollars so long as the yuan is pegged to the dollar? A rose by any other name...
posted by mr_roboto at 11:49 AM on June 18, 2009


The article seems to make its own headline premature. There is a lot of hope and speculation in this article, and it seems the author is hoping for the demise of the US Dollar as an international standard to ruin the "American war machine."

It is the first formal step by our major trading partners to replace the dollar as the world’s reserve currency. If they succeed, the dollar will dramatically plummet in value (emphasis mine). It is startling/impressive to note that "China, as Hudson points out, has already struck bilateral trade deals with Brazil and Malaysia to denominate their trade in China’s yuan rather than the dollar, pound or euro."

In a Wall Street Journal article, it is noted that "Malaysia's prime minister said China and his country are considering conducting their trade in Chinese yuan and Malaysian ringgit, joining a growing number of nations thinking of phasing out the dollar." This sounds less like China is trying to make the yuan the new global currency, and more like countries are looking to cut themselves from single currency reliance.
posted by filthy light thief at 11:50 AM on June 18, 2009


"In 2007, Dr. Hudson was Chief Economic Policy Adviser
for the Kucinich for President campaign"
"
posted by IndigoJones at 11:53 AM on June 18, 2009


OK, having gotten through the article, I kept waiting to see the author say, "YEKATERINBURG HAS 4 CORNER SIMULTANEOUS 4-DAY AMERICAN EMPIRE."

Anyone want to disabuse me of the notion that this is just one man's Armageddon fantasy?
posted by lekvar at 11:53 AM on June 18, 2009


Hmmm. That last paragraph certainly does paint an imminent Grim Meathook Future:
The cost of daily living, from buying food to getting medical care, will become difficult for all but a few as the dollar plunges. States and cities will see their pension funds drained and finally shut down. The government will be forced to sell off infrastructure, including roads and transport, to private corporations. We will be increasingly charged by privatized utilities—think Enron—for what was once regulated and subsidized. Commercial and private real estate will be worth less than half its current value. The negative equity that already plagues 25 percent of American homes will expand to include nearly all property owners. It will be difficult to borrow and impossible to sell real estate unless we accept massive losses. There will be block after block of empty stores and boarded-up houses. Foreclosures will be epidemic. There will be long lines at soup kitchens and many, many homeless. Our corporate-controlled media, already banal and trivial, will work overtime to anesthetize us with useless gossip, spectacles, sex, gratuitous violence, fear and tawdry junk politics. America will be composed of a large dispossessed underclass and a tiny empowered oligarchy that will run a ruthless and brutal system of neo-feudalism from secure compounds. Those who resist will be silenced, many by force. We will pay a terrible price, and we will pay this price soon, for the gross malfeasance of our power elite.
Man, that would suck. Do I need to take this guy seriously? Let's look at his past work...

Only Nader Is Right on the Issues

Whew!
posted by Halloween Jack at 11:54 AM on June 18, 2009 [13 favorites]


I'm laughing now, so that I can later remember fondly what laughter was like before the fall.
posted by Eideteker at 11:54 AM on June 18, 2009 [1 favorite]


I remember it being spoken of in the 80's and 90's, but the people who used the term were generally dismissed, at best, as cranks. Now it's getting main-stream media play, without irony or sarcasm.

You've been an empire since 1898.
posted by Artw at 11:55 AM on June 18, 2009 [4 favorites]


Oh, dear lord. Can he be any more biased or doomsday about it? The author seems to have a poor grasp of history. Here's a better (and by better I mean accurate and objective) explanation:
The Shanghai Cooperation Organization (SCO), comprising Russia, China and four ex-Soviet Central Asian republics--Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan-- held their own summit Tuesday in the Russian Ural city of Yekaterinburg. The leaders of SCO countries agreed to take Russia's proposal on using their national currencies in mutual settlements and introducing a common currency for the group.

The common currency would be similar to the European currency unit and the monetary union currency in 2013 of the Gulf Cooperation Council countries that include Bahrain, Kuwait, Qatar and Saudi Arabia.
In other words, they're making their own common currency, similar to the Euro, because
a) lately the dollar's been too volatile to be a reliable reserve currency
and
b) China and Russia are trying to make the Yuan and Ruble (respectively) more appealing to investors.

This is simple globalization. It isn't the end of the world, nor is it an indication that America's economic hegemony is about to vanish. Just as it didn't vanish when the Euro was introduced. Do we need a more progressive tax structure? Yes. Should we spend less on the DoD? Definitely. But, the author seems to be hoping for our economy to implode under President Obama. This summit won't be that tipping point.
posted by zarq at 11:56 AM on June 18, 2009


You've been an empire since 1898.

Living in the US makes it less "you" and more "we".
posted by YoBananaBoy at 11:58 AM on June 18, 2009


There will be block after block of empty stores and boarded-up houses. Foreclosures will be epidemic. There will be long lines at soup kitchens and many, many homeless. ... America will be composed of a large dispossessed underclass and a tiny empowered oligarchy that will run a ruthless and brutal system of neo-feudalism from secure compounds. Those who resist will be silenced, many by force.

Human sacrifice, dogs and cats living together... mass hysteria!

Sorry. I actually agree with just about everything the writer said... but he does come off as a shrieking alarmist. The decline of empires usually takes decades, if not centuries. We do have nukes now, of course...
posted by Joe Beese at 11:58 AM on June 18, 2009


What does it matter that trade is denominated in yuan rather than dollars so long as the yuan is pegged to the dollar?

Uh oh...
posted by mark242 at 11:58 AM on June 18, 2009 [1 favorite]


Living in the US makes it less "you" and more "we".

TBH I could have done that without even moving, given the UK-US relationship.
posted by Artw at 12:00 PM on June 18, 2009


countries are looking to cut themselves from single currency reliance

There have been rumblings of this sort for some time now.

Also, fwiw, while it may not be premature to say that a fundamental realignment of world financial power is indeed occurring, reading the future has never been easy (for instance: as goes California so goes America?; as goes Fedex so goes the economy?)...
posted by ornate insect at 12:02 PM on June 18, 2009


This article is pretty much right though a bit over the top. But it's right for all the wrong reasons.
posted by tkchrist at 12:04 PM on June 18, 2009 [1 favorite]


When a scaremonger's diatribe is sourced with a litany of .orgs, wikipedia links, book reviews, and personal home pages, and especially if it contains the word "truth" in the URL, I rest easy. Christ, you learn in middle school not to read into shit like this.
posted by Christ, what an asshole at 12:05 PM on June 18, 2009 [4 favorites]


Uh oh...

That's a picture of a bear. This is what decoupling means. The rembini is allowed to float in a narrow band around a basket of currencies, much of which is based on the US dollar, and it's still effectively a pegged currency. What's your point?
posted by mr_roboto at 12:07 PM on June 18, 2009


especially if it contains the word "truth" in the URL

Nah, truthdig is cool. Robert Scheer has major old-school lefty journalism cred.
posted by mr_roboto at 12:08 PM on June 18, 2009


*starts practicing Jugger*
posted by brundlefly at 12:09 PM on June 18, 2009


From the Economist:

... the really striking thing is that four countries first lumped together as a group by the chief economist of Goldman Sachs chose to convene at all, and in such a high-profile way. And that when they met, they discussed topics such as reforming the IMF; their demand for more say in global policy-making; and, in the case of China, Brazil and Russia, a plan to switch some of their foreign-currency reserves out of dollars and into IMF bonds.

Furthermore, from another Economist article:

Russia's statement that it will sell some American Treasuries to finance its purchase of the soon-to-be-issued IMF bonds. He discounts the possiblity that actions like this could affect the T-bill market because he believes any IMF bonds will likely be denominated in dollars and because potential Russian purchases will probably be little more than a drop in the bucket.

But this is not the conclusion of Brookings's Eswar Prasad, who has argued that IMF bonds will quite likely be denominated in SDRs, thus allowing for some currency diversification, but also that even if the likely scale of countries' IMF bond purchases aren't enough to rock the T-bill market, they could affect American interest rates if markets react adversely to countries having a new alternative to Treasuries.


You may ask what SDRs are. Special Drawing Rights are a currency that tracks a basket of other currencies. Sounds like the currency equivalent of an index fund to me. As of this year, one SDR is about 40% dollar, 35% euro. This may change as time goes on.
posted by zonem at 12:12 PM on June 18, 2009


The idea of American Empire has been easier to swallow since we got an Emperor above the law and answerable to no one.
posted by DU at 12:14 PM on June 18, 2009 [2 favorites]


They lost me at 'the criminal class on Wall Street.'

after the ten seconds I spent imagining what the homework for a criminal class would be like.
posted by zippy at 12:14 PM on June 18, 2009 [2 favorites]


Hmmm. That last paragraph certainly does paint an imminent Grim Meathook Future:
The cost of daily living, from buying food to getting medical care, will become difficult for all but a few as the dollar plunges. States and cities will see their pension funds drained and finally shut down. The government will be forced to sell off infrastructure, including roads and transport, to private corporations. We will be increasingly charged by privatized utilities—think Enron—for what was once regulated and subsidized. Commercial and private real estate will be worth less than half its current value. The negative equity that already plagues 25 percent of American homes will expand to include nearly all property owners. It will be difficult to borrow and impossible to sell real estate unless we accept massive losses. There will be block after block of empty stores and boarded-up houses. Foreclosures will be epidemic. There will be long lines at soup kitchens and many, many homeless. Our corporate-controlled media, already banal and trivial, will work overtime to anesthetize us with useless gossip, spectacles, sex, gratuitous violence, fear and tawdry junk politics. America will be composed of a large dispossessed underclass and a tiny empowered oligarchy that will run a ruthless and brutal system of neo-feudalism from secure compounds. Those who resist will be silenced, many by force. We will pay a terrible price, and we will pay this price soon, for the gross malfeasance of our power elite.
Yeah, that's pretty silly. I mean, why's it written in the future tense like that?
posted by Sys Rq at 12:25 PM on June 18, 2009 [6 favorites]


So, Neal Stephenson will start writing sitcoms, instead of near-future sci-fi, without changing the content of his work?
posted by gurple at 12:25 PM on June 18, 2009 [4 favorites]


Good point, Sys Rq. The guy makes it sound like it's imminent doom instead of what's going on right now. For my money James Howard Kunstler has a better corner on the apocalyptic horror "Ye Must Repent" market.
posted by blucevalo at 12:32 PM on June 18, 2009


But it's right for all the wrong reasons

I agree with this. There are several alternate meathook futures ahead of us and I have no confidence that we'll avoid them all, which is largely why 我现在学习中文。
posted by @troy at 12:33 PM on June 18, 2009 [3 favorites]


So, Neal Stephenson will start writing sitcoms, instead of near-future sci-fi, without changing the content of his work?

I'd buy that for a dollar.
posted by anti social order at 12:34 PM on June 18, 2009 [4 favorites]


the apocalyptic horror "Ye Must Repent" market

Otherwise known as doom-porn.
posted by ornate insect at 12:36 PM on June 18, 2009 [2 favorites]


As a bit of context on the writer, Chris Hedges was a longtime war correspondent for the New York Times and his experiences reporting on the collapse of Cold War geopolitics in the Balkans, the Middle East and Central America inspired a brilliant book called War Is A Force That Gives Us Meaning. Which if I was teaching a course in the true nature of modern war - the answer to the question of why? - I'd put Hedges' book at the very top of the list (complemented by Studs Terkel's "The Good War").

That said, he seems to have grown a little too gleefully apocalyptic in his tone in recent years. On the other hand, anyone predicting the total collapse of Wall Street investment banking in say 2005 would've sounded a bit hysterical, too.
posted by gompa at 12:39 PM on June 18, 2009 [5 favorites]


2nding gompa.
posted by lalochezia at 12:41 PM on June 18, 2009


So has anyone tried to find the "Table 5" that Hedges and Hudson reference? I went here:
http://www.bea.gov/international/bp_web/simple.cfm?anon=99457&table_id=15

I can't figure this out. But, I'd be curious to know if any mefites could actually break the numbers down-- or at least point us in the right direction.
posted by wuwei at 12:44 PM on June 18, 2009


"It is the first formal step by our major trading partners to replace the dollar as the world’s reserve currency. If they succeed, the dollar will dramatically plummet in value (emphasis mine). It is startling/impressive to note that 'China, as Hudson points out, has already struck bilateral trade deals with Brazil and Malaysia to denominate their trade in China’s yuan rather than the dollar, pound or euro.' "

Yes, but China and Russia know full well that the value of their dollars is at risk in a scenario like that, and they are two of the top three holders of US debt in US dollars. If the dollar plunges, so does our debt, but the holders of that debt will see losses. Plus, the yuan is directly controlled by the Chinese government and is not traded on currency exchanges, so it will never be used as the default global currency as long as that's true. They can and do trade using the yuan, but there is a lot of reluctance to allow that to be the dominant currency if it has no known value in relation to the rest of the market, and if the Chinese government could directly manipulate it (as opposed to accepted - if somewhat unpopular - methods like quantitative easing).
posted by krinklyfig at 12:46 PM on June 18, 2009


So which currency should I buy a handful of?
posted by davejay at 12:52 PM on June 18, 2009


it seems the author is hoping for the demise of the US Dollar as an international standard to ruin the "American war machine."

Why do you put American war machine in quotes, as if it were a fanciful notion?
posted by five fresh fish at 1:02 PM on June 18, 2009


The government will be forced to sell off infrastructure, including roads and transport, to private corporations.

Wouldn't it be ironic if the US would have to sell Alaska back to Russian oligarchs, to pay off debts?
posted by Blazecock Pileon at 1:04 PM on June 18, 2009


I'm always a little baffled by doomsday scenarios which have China conspiring to send the US back to the stoneage. I'm sure the Chinese technocrats sit around all day longing for the day when their single biggest market goes completely broke--just like they find nothing more enjoyable than jabbing themselves in the eyes with their chopsticks after a hard day's work.
posted by yoink at 1:05 PM on June 18, 2009 [2 favorites]


The Apocalypse will be FUCKING AWESOME!!!
posted by Artw at 1:10 PM on June 18, 2009 [1 favorite]


Wouldn't it be ironic if the US would have to sell Alaska back to Russian oligarchs, to pay off debts?

Speaking for the Govt of Canada (our banks are fine, thank you very much) I'm sure we'd like to put in a bid on this one.
posted by sporb at 1:16 PM on June 18, 2009


Much of the US dollar's strength lies in it being the oil dollar.

When oil runs out, what then?
posted by five fresh fish at 1:17 PM on June 18, 2009


sporb: how much will Canada pay us if they take Alaska to keep the Palins?
posted by mephron at 1:24 PM on June 18, 2009


Remember when Americans were whining about how unfair it was because that China "pegged" it's currency and wouldn't let it appreciate, thus making it difficult for U.S. exporters? Now they're all panicking that china might stop buying bonds. Well, the way china pegs it's currency is by buying bonds and other dollar denominated currencies.

Also, the U.S. government isn't "bankrupt" it just refuses to raise taxes. Our national deficit could be wiped out with the stroke of a pen (and some very unhappy billionaires)
posted by delmoi at 1:34 PM on June 18, 2009 [3 favorites]


"So which currency should I buy a handful of?"

Well, to be honest I'm going to put some money into yuan and buy a few Chinese companies on the HK market on the next dip, or when the dollar/yuan ratio gets strong enough, but just a bit, and only in very solid, long-term companies which pay regular, increasing dividends. Their growth is around 6-7% right now, and it's a recession there, too. Very speculative, I should mention. If the dollar gains strength against the Yuan, that investment will be devalued on paper regardless of its actual value, but the Chinese government would be happy. Most of my investments are in dollars in solid dividend payers with DRIP, mix of US companies and ADRs. I'm mostly an income/value investor (i.e., I look for low prices on steady dividend payers, not growth so much), so take that for what it's worth. I don't think the Euro nor the Yen is going to do very well, but I have a little in some British ADRs. Maybe Brazil might see some real growth, and they have a much better handle on their economy now, as does Argentina. You can buy a basket of currencies as a fund for a safe investment, but gold is always useful as a hedge; not so much as a long-term investment, though. It gains as the dollar drops, and vice-versa. Commodities needed by growing markets are going to do well long-term (whether that includes the US remains to be seen), but we're seeing that market top-out at the moment.

The big problem for the US is how closely the dollar is tied to the price of oil. As the dollar gets devalued, oil goes up. That could be a real problem for everyone if it's not reined in. The fed has to be very careful about easing up on Treasury buybacks if the dollar gets too low, but if nobody buys our Treasurys, yields get high and interest rates rise, crimping growth and housing, and it could spiral into further devaluation of the dollar/stagflation.

"Much of the US dollar's strength lies in it being the oil dollar.

"When oil runs out, what then?"


It's a double-edged sword, because it's one of our biggest problems. It ties us to all sorts of expensive and difficult relationships and impedes progress in many ways (think about the fact that we're still haggling about public transportation, the Iraq War and 35mpg efficiency standards). It probably will shift the global economy permanently. Who knows which way?
posted by krinklyfig at 1:35 PM on June 18, 2009 [1 favorite]


Sorry; America's First Family of Fun would need Canadian Passports. But wait: I bet our current Minority Parliament Prime Minister is a big fan of those crazy "Northern Neighbours" - I think he attends their Church.

We might be able to make a deal.
posted by sporb at 1:35 PM on June 18, 2009


Much of the US dollar's strength lies in it being the oil dollar. When oil runs out, what then?

We'll rename it, from petrodollars to energydollars. Trading will continue.
posted by Houstonian at 1:49 PM on June 18, 2009


Our national deficit could be wiped out with the stroke of a pen (and some very unhappy billionaires)

Oh, yes, please can we do this?!
posted by Houstonian at 1:51 PM on June 18, 2009 [1 favorite]


Also, the U.S. government isn't "bankrupt" it just refuses to raise taxes. Our national deficit could be wiped out with the stroke of a pen (and some very unhappy billionaires)

It's interesting that the time at which Artw pegs the United States as an empire (early 1900s) is also the time at which the marginal income tax rate reached as high as 77% for millionaires during WW I, and between 60-95% during the Great Depression and WW II. This is the age of the Rockefellers, Fords, Mellons, Morgans, etc. Taxation for the highest brackets remained in the 90% range until the mid-1960s, before dropping to 70%.

What are the wealthiest Americans taxed now, to the extent that their wealth is not already hidden in off-shore accounts? 35%. Capital gains tax rates have been even lower due to tax relief bill passed during the Bush administration.

We're now experimenting with reverse socialism. Before this country raises taxes again, a lot of the commons will be sold off, piece by piece, and redistributed to private hands.
posted by Blazecock Pileon at 1:51 PM on June 18, 2009 [5 favorites]


America will be composed of a large dispossessed underclass and a tiny empowered oligarchy that will run a ruthless and brutal system of neo-feudalism from secure compounds. Those who resist will be silenced, many by force. We will pay a terrible price, and we will pay this price soon, for the gross malfeasance of our power elite.

I bet he got a stiffy while writing this. Good lord.
posted by The Light Fantastic at 1:53 PM on June 18, 2009


Bailout Costs vs Big Historical Events
posted by Substrata at 2:07 PM on June 18, 2009 [1 favorite]


sporb: how much will Canada pay us if they take Alaska to keep the Palins?

Waitaminute...who's paying whom now?

We will gladly babysit Alaska for a reasonable fee. However, we can't guarantee any safeguards against the occasional Palin snowmobile* breakdown in wolf'n'grizzly country after having confiscated all their guns.

Heck, we'll even adopt Michigan if you ask politely enough.

*That is what we will call them.
posted by Sys Rq at 2:19 PM on June 18, 2009


Bailout Costs vs Big Historical Events

That's pretty deceptive. A lot of those "costs" don't represent actual money spent, but rather guarantees or facilities. The commercial paper funding facility, for instance, represents a pool of short-term loans that can be made to financial institutions in order to increase financial market liquidity. Since the US government promised to loan against all outstanding commercial paper, that facility is necessarily huge: equal to the size of the entire commercial paper market. That doesn't mean that this was a cost to the US government. What paper the facility has bought has held its value, since the commercial paper market hasn't collapsed (which was to point of estabilishing the CPFF in the first place).

This is in contrast to the blocks on the right hand side, which represent money that's actually spent and gone...
posted by mr_roboto at 2:26 PM on June 18, 2009 [2 favorites]


mr_roboto: If I had even one thin nickel for every time I tried to correct some really basic misunderstanding like that about the policies surrounding the financial recovery efforts--well, let's just say, even at a nominal tax rate of only 35%, the US deficit would soon be a thing of the past.
posted by saulgoodman at 2:57 PM on June 18, 2009


It's fascinating how you can't shout "There's a car coming! Get out of the way!" without being accused of wanting people to get hit by cars.
posted by Pope Guilty at 3:08 PM on June 18, 2009


On topic: I'd like to start a pro-tax lobby. It would be called:

Proud
American
Taxpayers for
Responsible
Income and
Opportunity
Taxation

We would work to promote awareness of our nation's patriots long history of supporting responsible taxation even if that meant higher taxes (for example, when our founding fathers staged the Boston Tea Party to protest irresponsible British tax cuts under the Tea Act).

We would lobby congress to raise taxes to at least 70% on every dollar earned over the threshold for individuals earning over a million dollars annually. We would also promote corporate tax reform (particularly in industries heavily dependent on natural resources, like the oil industry) and we would work at the state level to reverse the massive property-tax cuts that are strangling states like California and Florida.

Who's with me? Come on, fellow PATRIOTS! Join the cause!

Ah, who am I kidding. We're screwed.
posted by saulgoodman at 3:12 PM on June 18, 2009 [3 favorites]


It's fascinating how you can't shout "There's a car coming! Get out of the way!" without being accused of wanting people to get hit by cars.

It seems to me that most of these types of articles shout not to get out of the way but rather, "There's a car coming! We're all doomed!"
posted by Juffo-Wup at 3:30 PM on June 18, 2009


Much of the US Canadian dollar's strength lies in it being the oil dollar.

ftfy
posted by oaf at 3:43 PM on June 18, 2009 [1 favorite]


"Much of the US Canadian dollar's strength lies in it being the oil dollar."

Yeah, very true. A lot of people forget that or don't realize it.
posted by krinklyfig at 3:50 PM on June 18, 2009


It seems to me that most of these types of articles shout not to get out of the way but rather, "There's a car coming! We're all doomed!"

Exactly, except it's more along the lines of:

"A car is coming. It is unstoppable and will destroy all that you love. Your life will be rendered meaningless as the broken, mangled bodies of everyone you know are thrown at your feet. In a final fit of despair, you will jump in front of this car and also be destroyed."
posted by The Light Fantastic at 3:57 PM on June 18, 2009 [3 favorites]


I am certainly not pro-tax by any means, but I would support significantly — and I mean orders of magnitude — higher taxes on all non-renewable resource extraction. If you're extracting resources from the earth, or damaging it in any way that takes longer than a human lifetime to repair, we should be taxing the living shit out of whatever activity you're doing.

The taxes on fossil fuels should be phenomenally high. They're never coming back; once we burn them, that's it — they're gone. So they should have taxes on them sufficient to pay for the theft we're committing from every generation that comes after us.

In the short run, of course, this would mean that fossil fuels would just be imported, and nothing here in the U.S. would be extracted. But that's a feature, not a bug. It would ensure that we'd be the last ones on the planet to start extracting our fossil fuels, and we'd do it only for the things that really required it. If other countries decide to sell themselves down the river, that's their business I suppose — no need to shoot ourselves in the foot with tariffs — but I suspect they'll eventually regret it.
posted by Kadin2048 at 3:59 PM on June 18, 2009 [1 favorite]


Much of the US Canadian dollar's strength lies in it being the oil dollar.

Gosh darn, that would be so very relevant if only this were a discussion titled "The Canadian Empire is Bankrupt."

But it isn't. You fail.
posted by five fresh fish at 4:25 PM on June 18, 2009


Yes, but China and Russia know full well that the value of their dollars is at risk in a scenario like that, and they are two of the top three holders of US debt in US dollars. If the dollar plunges, so does our debt, but the holders of that debt will see losses

Isn't this exactly why China has spent the last year or two on a huge diversification kick? They'd've bought up most of the Australian mining sector last year if they'd been allowed, seem to be cornering the market in copper.
posted by pompomtom at 4:28 PM on June 18, 2009


It seems to me that most of these types of articles shout not to get out of the way but rather, "There's a car coming! We're all doomed!"

To me, they come across more as "There's a car coming! It's going to hit that guy I don't like! And his little dog too! Then it's going to crash into and burn down the Wal-Mart across the street! There's a car coming! There's a car coming! [jig]"
posted by dhartung at 4:29 PM on June 18, 2009 [2 favorites]


I haven't seen any of these for a while, but those "brown hordes will sweep decrepit Europe away" articles that Neocons used to write all the time always took that tone, even though they usually had some disclaimer that they weren't wishing this upon Europe, they were just really, really sorry that it was going to happen.
posted by Artw at 4:36 PM on June 18, 2009


Somehow, this seems appropriate.

I say, Let 'em crash.

Somehow, there's some subconscious part of humans that WANTS it all to come crashing down. But life will go on, empires will rise and fall, babies will be born, wars will be fought, death, love and the human condition will go on for a very, very long time.

70,000 years ago, we almost didn't make it, and if something happens that even wipes us all out, life just starts over from the beginning. The lonely, single-celled beginning.

After all, in the big scheme of things, we're just a pale blue dot.

So relax, and enjoy what you can on this crazy ride.
posted by chambers at 4:42 PM on June 18, 2009 [1 favorite]


Im pro-tax. I think we should raise taxes in California and in the country.

Im floored by the idiots in my fair state who vote for all of these money spending referendums, and then vote to lower taxes, then get up in arms when budget gets cut from other places. The money has to come from somewhere, morAns.
posted by subaruwrx at 4:44 PM on June 18, 2009 [2 favorites]


Gosh darn, that would be so very relevant if only this were a discussion titled "The Canadian Empire is Bankrupt."

But it isn't. You
don't fail.

FTFY.
posted by Sys Rq at 4:50 PM on June 18, 2009


IndigoJones: ""In 2007, Dr. Hudson was Chief Economic Policy Adviser for the Kucinich for President campaign"""

Which makes him uncredible because Kucinich is short, right? It wouldn't have anything to do with Kucinich representing the sizable portion of the American population which is anti-war, anti-corporatism, pro-accountability and pro-social safety net, because that just wouldn't make sense...
posted by l33tpolicywonk at 5:44 PM on June 18, 2009 [1 favorite]


Kucinich doesn't represent a sizable portion of anything. His campaigns never got traction, even for an "issue" campaign. He got 1% in New Hampshire last year, or about 3000 more votes than Joe Biden, who had already dropped out.
posted by spaltavian at 6:31 PM on June 18, 2009


Gosh darn, that would be so very relevant if only this were a discussion titled "The Canadian Empire is Bankrupt."

It would be so very relevant if there were a dollar whose value were more intimately linked to the price of oil. The dollar best fitting that description happens to be the Canadian dollar.

You fail.

Not really.
posted by oaf at 6:49 PM on June 18, 2009


When the international community no longer needs American dollars to purchase their oil, or when oil runs out, the dollar is fucked. The strength of the US dollar is predicated on the oil trade.

Canadian dollars have sweet fuck all to do with it. Quit being the jackass, jackass.
posted by five fresh fish at 7:16 PM on June 18, 2009


Might as well have called that, Left-Wing Writer Talks About Amerikkka and How It's Doomed, even if you think the country will be lucky if gets out of all this doing OK.
posted by raysmj at 7:31 PM on June 18, 2009


We could call it Canadalaska!
posted by ageispolis at 7:41 PM on June 18, 2009


So which currency should I buy a handful of?

Dry beans, apparently.
posted by dilettante at 7:49 PM on June 18, 2009


Canadian dollars have sweet fuck all to do with it.

Except for tracking the price of oil, you mean.
posted by oaf at 8:12 PM on June 18, 2009


spaltavian: "Kucinich doesn't represent a sizable portion of anything. the Democratic primary campaign electorate in a series ofl early primary and caucus states, who are all voting 'strategically' so their candidate can win in November."

FTFY. The underlying point here is that association with Kucinich does not make you not credible by default. Kucinich's run in Cincinnati (and his ability to win a congressional seat at all), suggests at least a sizable portion of voters in a major Midwestern city think he's not too bad.
posted by l33tpolicywonk at 8:13 PM on June 18, 2009



Gosh darn, that would be so very relevant if only this were a discussion titled "The Canadian Empire is Bankrupt."

But it isn't. You fail.


Yes, fff, I completely agree. I hate it when posters feel the need to take a huge dump in the discussion with some wildly irrelevant point due to the chip they have on their shoulder about one country or another. There's some that seem to do it in every single post they make. Can't seem to help themselves. Let's stay vigilant and keep thing on point.
posted by Arch_Stanton at 8:51 PM on June 18, 2009 [2 favorites]


Please point at the "huge dump" in this thread, Arch.
posted by five fresh fish at 9:03 PM on June 18, 2009


Somewhat tendentious but generally informative piece from Henry C.K. Liu on the recent SCO and BRIC meetings in Yekaterinburg.
posted by Abiezer at 11:31 PM on June 18, 2009


Ha ha ha ha ha.

No.
posted by Hello Dad, I'm in Jail at 1:20 AM on June 19, 2009


Yes, Canada's banks are on much better footing than just about all other countries, but we still need markets to trade with...

The current economic crisis has seriously impacted Canada's manufacturing and tech sectors. Perhaps more so than other countries because so many of those industries in Canada were branch plants of foreign or multinational companies, and so they were first plants to get the chop. Ontario has lost so much that it's now a "have-not" province, receiving transfer payments from the oil-rich provinces.

Canada's economic growth has been slow and steady... not too adventurous... cos that's how we Canadians roll. But it's also due to underwhelming economic direction or planning from the governments (example - big concessions to automakers to open Canadian plants was about the extent of daring government incentives)

So... Canada is left with solvent banks, and a shitload of natural resources... and that's about it economically, for the near future. It's like we've been knocked back 40 years. Still, could be worse.

So, yeah, the CDN dollar is still pretty much tied to resources, and the resource that's still selling strong is ...oil.

(sorry for prolonging the derail)
posted by Artful Codger at 6:28 AM on June 19, 2009


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