The Cunning Realist makes this interesting point that's all too often overlooked - by running up giant deficits the Bush administration is putting the control of our interests rates in the hand of foreigners!
What's troubling is that we don't determine our own interest rates at this point. Essentially, the rest of the world is telling us that if we want to borrow to pay for preemptive wars and a reckless fiscal policy, we can---but other nations won't underwrite it on favorable terms. Think about that the next time your mortgage or credit card payment increases. President Bush gets blamed for a lot, and justifiably so. But this de facto ceding of monetary power to foreigners is an inexcusable and dangerous screw-up. It didn't have to happen.
Maybe that's a bit overstated, maybe not. But I think there's something to that - something that you would think would worry the xenophobic, uber-nationalists in the US House.
Posted by armand at May 29, 2006 11:38 AM | TrackBack | Posted to Economics