Saturday, September 6, 2008


The 51st state of the Union can’t be the District of Columbia nor Puerto Rico. No, we’ve already expanded the United States of America by the largest one ever – the State of Denial. Its vast territory, coextensive with the other 50 states, includes American men and women of all parties, races, religions, sexual orientations, and social classes.

How else can one explain the steep descent of the political debate this year, the most crucial national election in 76 years? Democrats have reverted to promising spending programs and targeted tax breaks for deserving folks, knowing all the while that they can’t be paid for. They tell their base: watch out for Republicans; they don’t care about folks like you. Republicans have reverted to promising tax cuts for the wealthy and spewing out fierce rhetoric about cutting spending, knowing that only a small portion of which is discretionary. They tell their base: watch out for the Democrats; they tax you and spend the money on others.

Nowhere in this empty debate is there any concept of the national interest. Nowhere is there a recognition that we are engaged in a global competition with governments that do have gobs of discretionary funds. China alone is sitting on piles of hard cash in the form of official reserves, sovereign wealth funds, social security investment funds and forced dollar holdings by commercial banks – in all, almost 2.5 trillion off-budget dollars that flowed into the country without the need to levy a tax on its citizens. They simply rig the price of their currency and let “the market” do the rest. The result is a slush fund large enough to cripple our producers for a long time.

How are we going to compete with that? How are we going to re build the productive capacity of this country? How are we going to start saving, investing and paying our own way in the world again? How can we be a strong, respected leader in the world with the rickety Ponzi-scheme economy that those geniuses on Wall Street have foisted on us? How can we hope to reverse our decline by denying it?

Charles Blum

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