Rebalancing The USSA

500 street hawkers were “evicted” from Chennai – while the entire focus is on the G-20 meet in Pittsburg. However, I will not recommend the editorial in the Economic Times, which reads like propaganda and not informed analysis. Indeed, the pivot of their argument is a patently false proposition:

“Boom and bust are an integral part of free-market capitalism.”

This is what Keynesians, who idolize The Total State and its Funny Money, believe. Economists of the Austrian School oppose this view, and hold that governments create bubbles and booms with easy money and cheap credit. This causes “malinvestments.” Hence the inevitable bust. The solution is real capitalism and sound money: Gold. Private money.

The Mint editorial on the G-20 is a far better analysis. It begins by presenting the USSA’s core concern at the G-20 meet: “Rebalancing.” This is the Obama Agenda:

“The US emphasis is on what it calls the “rebalancing” of the global economy: It wants to reorder global consumption and savings in a way that it saves more and China consumes more.”

This is plain nonsense. Even if US households save, the deficits and borrowings of Uncle Sam will render these savings meaningless. Peter Schiff discusses this in a recent vlog. Do watch it, and note the sincerity and moral fervour in his voice.

Smart Americans are getting wise to Uncle Sam’s hypocrisy. Here is what one smart college student and his professor accomplished, to win a "generational theft contest" sponsored by Pajama TV to determine how much Obama’s deficit and stimulus packages would cost each college graduate in the future:

Gavin and Ed…. tallied the cost of 2008 and 2009 government programs like TALF, TARP, FHA mortgage relief, assorted corporate bailouts and various stimulus packages, to name a few. That spending spree came to a whopping $10,825,400,000,000. Then, they crunched the numbers to determine what each college graduate will be taxed to help repay this deficit. Their calculation -- $148,035 each!

Read the report and watch the video here.

Methinks the USSA should “rebalance” itself.

What should the rest of the world do? As Peter Schiff says in the vlog cited above, the rest of the world should tell Obama that they will no longer lend money to the USSA, and will therefore no longer subscribe to US Treasury bills.

This will force Uncle Sam to end his profligate ways, and the whole world will be better off as a result.

Uncle Sam, Rebalanced.