Friedman: The 9/11 Bubble (Krugman could've wrote this column)

[RamboLiberal]

http://www.nytimes.com/2004/12/02/opinion/02friedman.html?hp=&pagewanted=print&position=

<snip>

This is a time when we really need a strong Treasury secretary capable of speaking up for fiscal sanity. We are about to embark on a 10-year period in which recent tax cuts and runaway spending are expected to add $5 trillion to the cumulative deficit. In my lifetime we will have gone from the Greatest Generation to the Profligate Generation to the Bankrupt Generation. Yes, I'm talking to you 20-year-olds. President Bush has called for sacrifice - but not by his generation. He's passing the bill onto your generation.

"The 9/11 crisis has been used as a license to spend and cut taxes rather than to set priorities and focus our resources on what is critically important to our nation's security," said Robert Hormats, vice chairman of Goldman Sachs International.

<snip>

The very reason Mr. Bush had the luxury of launching a war of necessity in Afghanistan and a war of choice in Iraq, without a second thought, was because of the surpluses built up by the previous administration and Congress. Since then, the Bush team has been slashing taxes in the middle of two wars, weakening the dollar and amassing a huge debt burden - on the implicit assumption that nothing will go wrong in the future.

But what if there is another 9/11 or war of necessity? We're cooked. The tax revenue won't be there, so the only option will be more borrowing and a weaker dollar. But what happens if the Chinese and other foreigners, who now hold over 40 percent of our Treasury securities, decide they don't want to hold these depreciating dollars anymore, let alone buy more?

It is now clear to me that we have followed the dot-com bubble with the 9/11 bubble. Both bubbles made us stupid. The first was financed by reckless investors, and the second by a reckless administration and Congress. In the first case, the public was misled by Wall Street stock analysts, who told them the old rules didn't apply - that elephants can fly. In the second case, the public was misled by White House economists, peddling similar nonsense. The first ended in tears, and so will the second. Because, as the dot-com bubble proved, elephants can fly - "provided it is not very long."

[Buck Rabbit]

1. And I wonder why I have a palm print mark beat into my forehead.

How could a bozo with a record like chimps not lose by 20 points. Worse President Ever.

[liberalpragmatist]

3. b/c some people just don't get it

I really do think Bush is the worst President ever. He is destroying American credibility and sowing the seeds of American destruction.

But the country doesn't realize this. Kerry tried - certainly made some mistakes in the process - but at the end of the day, Bush's approval ratings weren't anywhere close to his father's or Carters, both of whom had approval ratings in the 30s. Bush's stayed in the mid-to-upper 40s.

You reap what you sow.

[DenverDem]

4. He did. The "election" was a massive fraud.

Biggest.Scam.Ever.

[BlueEyedSon]

2. kick (as much as i hate to kick a Friedman piece)

[pretzel4gore]

5. friedman's a goof....

hell, anyone with a bit a wit knew geeb (brother of john ellis, or jeb) wasn't qualified to be president...his ripoff of arlington texas taxpayers in the stadium deal, or the harken oil shareholders, or texas' one-time-in-history reissue of a drivers licence # to him (thus preventing bush's record from being known) his role in the robin lowman illegal abortion affair, or margie schoedinger's inexplicable 'suicide' after she filed a rape lawsuit against bush, or james hatfield's death (hatfield publicised bush's probable cocaine drug possesion/conviction in his book 'fortunate son') not to mention the bush family involvement with hitler (as a jew, one would think friedman might take offense, but the whore needs money, just like a crackhead junkie)...tom friedman is one of the first mediasluts who should be tried/executed for treason...unfortunately, mediawhores mediate between the world and what's going on, thus friedman can pretend he's a real reporter....btw in his book 'from beirut to jerusalem' friedman mentioned israel's nuclear ability, though he said because israel has such a huge place in christian consciousness, israel could never be assaulted by overwhelming arab force anyway...the 'christians', including russia, would not allow israel to be destroyed because of their publics' opinion, thus israel really doesn't need the nukes....friedman can see this subtlety, but he doesn't notice that the gop/rnc/bushinc etc were the only ones to truly benefit from 911?!

[SteveWonder]

6. The World according to Friedman

Friedman is one of the most arrogant and often wrong columnists out there. As to this column, yes he is right. He's about two years too late though with this revelation. Anyone with any sense could have told us that cutting taxes and declaring war was a recipe for disaster with the possible exception of Greenspan himself. To see Friedman make his way into discussing economic matters is really a hoot. I do differ with him in regards to the public perception that we are deferring the cost of Bush's irresponsible fiscal policies to our future generations -- though I'm sure they'll pay to. With the dollar going nowhere but down and with the jobs market the way it is, I'd argue that we're already paying the price. One day the dollar will no longer be the fiat currency. Bush is simply speeding it up.

[newyawker99]

8. Hi SteveWonder!!

Welcome to DU!! :toast:

[bklyncowgirl]

10. Since coming back from vacation Friedman's been more right than wrong

I don't agree with the guy on globalization but he obviously seen the light regarding "Our Leader".

[The Zanti Regent]

7. Don't get me started!

this is too little and too late.

[pberq]

9. China is the key

Here is the most important part of the article:

"But what happens if the Chinese and other foreigners, who now hold over 40 percent of our Treasury securities, decide they don't want to hold these depreciating dollars anymore, let alone buy more?"

China has the means to sink the U.S.

So what are our "leaders" (including Dems) doing about this? Wasting billions of dollars and thousands of lives in Iraq.

If Friedman wants to redeem himself, he should start pounding on this China angle and not stop.