by William Murray A single verse of Old Testament Scripture explains the current turmoil of the Western financial markets: The Rich rule over the poor, And the borrower is the servant to the lender. Proverbs 22:7
The biggest concern of the Congress and the Bush Administration during the current financial crisis is to save the investments of the Chinese, the Japanese, the Saudis and other foreigners. Undersecretary of the Treasury, David McCormich actually called foreign investors to assure them that bonds issued to them by Fannie Mae and Freddie Mac would be honored before the government took over those mortgage companies. When the government took over the two firms, the American stock holders including those with preferred shares, lost all their money. Meanwhile the Japanese, Chinese and Saudis got every dime they had invested in those institutions guaranteed for repayment. That has been repeated in virtually every government takeover this year, including that of Washington Mutual.
Why? The trade imbalance is so great because of imports from China and oil from the Middle East, that the only way to attract dollars back to the USA is to borrow them. The reality is that the Iraq war debt along with most of the funds to bail out Wall Street is money borrowed from the dictators of China and the Islamic royalty of Saudi Arabia. Without money borrowed from them, the Treasury would have to print huge sums of money and cause such inflation that our economy would collapse.
This problem would not exist if the Democrats had allowed drilling for oil and expanded coal mining here at home. In North America, we have more energy reserves than do the Saudis. It is just that liberals and environmentalists have blocked obtaining that energy. As a result we are transferring the wealth of our nation overseas in exchange for energy.
The Democrat controlled Congress voted to allow offshore drilling for oil a short time ago as the anger of the American people rose with the cost of energy. Unfortunately the bill is just a farce based on lies. Radical Nancy Pelosi, who controls the House, presented a 243 page bill to congressmen just a few hours before scheduling a vote. It allowed drilling for oil from 50 to 100 miles offshore. No oil company will buy a lease or drill there, because 90% of the oil is within 50 miles of the shore. Also, the bill still forbids any drilling at all off the coasts of California and Florida where most of the oil actually is located. At the same time, the bill raised taxes on energy so that the heating bill of every American would go up this winter if it is passed into law.
Our debt now drives our foreign policy.
When extremist Muslims murder Christians in Iraq or the Chinese send us lead filled toys and contaminated candy that harms our children, our government mildly complains. The reality is that the Federal government cannot do much to stop contaminated generic drugs from being shipped from China or to stop the Saudis from sending hate filled school textbooks here either, because we can't offend the lenders. The United States is a debtor nation and cannot afford to offend those who lend to us.
We are transferring almost $700 billion a year to the Chinese and the Saudis to buy toasters at Wal-Mart and gas for our tanks. They then lend us back the money and we pay them interest on it. Exactly how long does this work before the nation is broke and totally the servant of the lenders? Leadership is needed now and it is not being displayed by Democrats or Republicans in the Congress. Rather than than make the hard decisions for long term gain, the Congress leans toward sending out checks to appease the peoples' appetite to buy contaminated Chinese made toys.
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