It’s Election Day! Woohoo!
Today, we Americans will enter voting booths all across the nation to pull the levers that will shape our destiny. Either we embrace the big, expensive promises of the Left or we embrace the big, expensive promises of the Right.
Our fate hangs in the balance.
The only thing we know for certain about our looming fate is that we cannot afford it…which means that our destiny rests not in the hands of a Barack Obama or a Mitt Romney; it rests in the hands of our creditors — guys like Zhou Xiaochuan, Governor of the People’s Bank of China, Masaaki Shirakawa, Governor of the Bank of Japan and Abdullah bin Fahd al-Mubarak, Governor of the Saudi Arabian Monetary Authority.
We might not be able to pronounce their names, but they are among the most powerful folks “in America.” In the real world, debtors don’t call the shots; creditors do. So if Xiaochuan, Shirakawa, al- Mubarek, et al. should decide to stop writing checks, “powerful” politicians like President Obama will become a lot less powerful.
During just the last four years, America’s national debt has skyrocketed from roughly $10 trillion to about $15 trillion. That’s not power, Dear Reader, that’s epic weakness.
By ceding control of her finances to foreigners, America is forfeiting much of her economic flexibility and freedom. But rather than addressing this lamentable fiscal trend by reducing the role of government, the American political machinery, in aggregate, has been expanding its role.
This well-greased machinery usually cites some sort of theoretical national emergency or vague national priority to validate each new intrusion into the private sector. As a result, government grows like a cancer, while the muscle of economic freedom atrophies. Before you know it, you’ve got a USSR-in-the-making.
According to the latest “Economic Freedom of the World” report, America’s economic freedom ranking has tumbled from second place in 2000 to 18th place in 2010. This report, co-published by the Cato Institute, the Fraser Institute in Canada and more than 70 think tanks around the world, attempts to ‘measure the consistency of the institutions and policies of various countries with voluntary exchange and the other dimensions of economic freedom.’
‘[T]he United States has fallen precipitously from second in 2000 to…18th in 2010,’ the Frasier Institute reports. ‘By 2009, the United States had fallen behind Switzerland, Canada, Australia, Chile, and Mauritius, countries that chose not to follow the path of massive growth in government financed by borrowing that is now the most prominent characteristic of US fiscal policy.
‘By 2010, the United States had also fallen behind Finland and Denmark, two European welfare states. Moreover, it now trails Bahrain, the United Arab Emirates, Estonia, Taiwan, and Qatar, countries that are not usually perceived of as bastions of economic freedom.’
for The Daily Reckoning Australia
From the Archives…
A Deflationary Conclusion to China’s Bubble
2-11-2012 – Greg Canavan
When ‘Nanny State’ Deficits Becomes Unviable
1-11-2012 – Marc Faber
Why Economists Are Jackasses
31-10-2012 – Bill Bonner
Riding out the Storm
30-10-2012 – Dan Denning
What We Couldn’t Say on CNBC About Economic Stimulus and Other Things
29-10-2012 – Bill Bonner