Here is an excerpt from a piece I wrote back on September 26th, before Congress passed the $700 billion TARP program. A lot of things have changed since then, but I still think this is a good and relevant piece. I did not change this from the way that I wrote it back in September, except to correct a spelling mistake in the last paragraph.
We should, however, worry about our economy now. The national debt is rapidly marching towards ten trillion dollars ($10,000,000,000,000). Our unfunded liabilities in Social Security and Medicare now total an additional sixty-seven trillion dollars ($67,000,000,000,000). By 2012 the Medicare fund will be going into a deficit and we will be forced to spend tax dollars to keep up with Medicare payments. By 2017, the same thing happens with Social Security. American families now owe over $15 trillion in household debt. We have nothing left. We are witnessing the slow, painful fall of the American Empire. It hurts me to watch because I love this Nation so much.
For years we threw money at problems without ever trying to really solve them (poverty, drugs, education, health care). Now we have no money and things are getting worse in all of these areas.
Iconic American companies are being swallowed up by foreign firms at an unprecedented rate. Budweiser is being bought out by a Dutch firm, Miller is now owned by South Africans, and Coors is owned by Canadians. Ford, Chrysler, and General Motors are now on the brink of extinction and are closing down American plants to move to other nations.
Sovereign wealth funds (companies owned by foreign governments) have been buying up large stakes in American companies—these sovereign wealth funds now own about 10% of Citigroup, 20% of the NASDAQ stock exchange, 9% of UBS, 10% of Morgan Stanley. They own 7.5% of the Carlyle Group (which owns major defense contractors, telecommunications and technology companies, CSX railroads’’ domestic container lines, and consumer companies like Baskin-Robbins and Dunkin’ Donuts). China owns 10% of the Blackstone Group (which owns Hilton Hotels, American textbook publisher Houghton-Mifflin, Universal Studios Parks, and is in the process of purchasing a large stake in The Weather Channel). These wealth funds also own well over 10% of Merril Lynch (RIP), 2% of Barclays (which controls large portions of the stock of many large companies—go here and put in any symbol and you will see that Barclay’s owns a large stake), 7.5% in Diamler, AG, and several hundred million dollars worth of Visa.
The German government owns 35.5% of DHL, 20.3% of Volkswagen, and 32% of T-Mobile. Through its stake in Renault, the French government owns 6.9% of Nissan. Any time that you buy a product or a service from one of those companies, you are essentially paying a tax to a foreign government. For example, if you stay at a Hilton hotel, 10% of the profit made from your visit goes to the Chinese government. If you buy a new Mercedes, 7.5% of the profits made subsidize the Dubai government. Do you think that American text books will continue to criticize the policies of Mao, now that China owns 10% of the company that makes our history books?
This is socialism, but at least in traditional socialism, Americans would see some benefit from their dollars going to state-owned enterprises. In this case however, American dollars are going directly into the hands of foreign governments. Would foreign nations tolerate the American government coming in and buying up stakes in their countries? think not.
Do you remember mercantilism from history class? That is what is happening in this country. We export food, chemicals, plastic, cigarettes, cotton, and many other raw materials, only to import these goods back into the country later as finished goods: the cotton comes back as clothing, the plastic comes back in the form of goods made in China, and so on. We produce nothing here. We consume foreign goods like the world is ending tomorrow. We now have the import/export profile of a 3rd world nation.
Rome is burning while Congress is playing the fiddle. Be scared. You should be. Your children will know a different America.