Couple of things... first I don't think the accumulation of US Treasury notes or bills overseas has anything to do with the savings rate of the US public. I also don't think that the accumulation of US dollars or govt securities by foreign countries indicates the decline of US capitalism, a threat to the US ruling class, or the decay of US manufacturing capability.
I do think US borrowing, US govt borrowing has everything to do with tax revenues and expenditures, like ah... let's see US was running a budget surplus prior to 2001, was considering pulling, actually may have in fact pulled, the 30 yr bond from the markets by advanced redemptions, all of which I think was based on Clinton's tax increases, and the increased profits of the 92-99 period. And then... well overproduction and Boy George resurfaced, and it was grab as grab can. I think most of the ruling class "concern" over deficits, trade and current account, is really a holdover from the obsolete mercantilism that stands behind every capitalist exchanger. ----- Original Message ----- From: "raghu" <[EMAIL PROTECTED]> To: <PEN-L@SUS.CSUCHICO.EDU> Sent: Thursday, August 09, 2007 5:17 PM Subject: Re: [PEN-L] uncle sam's banker > On 8/9/07, sartesian <[EMAIL PROTECTED]> wrote: > > And the greater damage would be done to whom? The US ruling class, or the > > Chinese? Where would the impact be more likely to trigger social upheaval, > > the bugaboo of capitalists, emerging and arthritic, everywhere, called class > > struggle, Shanghai or Long Beach? > > > > I think the correct answer is both. If the Chinese really liquidate > even a quarter of their dollar portfolio I can't see how a complete > world-wide financial collapse far more severe than the 1998 Asian > crisis, can be avoided. Which is why there seems to be a consensus > that it will never happen. The Chinese can bark but they cannot bite. > > It seems like a risky tactic though. They may just end up > strengthening the Lou Dobbs faction. > -raghu. >
