Posted on February 22, 2006 by Steve
Ocala.com, February 18th, 2006
Last year America spent 57 percent more than it earned on world
markets. That is, our imports were 57 percent larger than our exports.
How did we manage to live so far beyond our means? By running up debts
to Japan, China and Middle Eastern oil producers. We’re as addicted to
imported money as we are to imported oil.
Sometimes large-scale foreign borrowing makes sense. In the 19th
century the United States borrowed vast sums from Europe, using the
funds to build railroads and other industrial infrastructure. That
debt-financed wave of investment left America stronger, not weaker.
But this time our overseas borrowing isn’t financing an investment
boom: Adjusted for the size of the economy, business investment is
actually low by historical standards. Instead, we’re using borrowed
money to build houses, buy consumer goods and, of course, finance the
federal budget deficit.
Read more…
Posted on February 22, 2006 by Steve
The New York Times, February 20th, 2006
ANDERSON, Ind., Feb. 16 — General Motors once had so many plants here that it had to stagger their schedules
so that the streets would not be clogged with traffic when the workday ended. At
the city’s peak, 35 years ago, one of every three people in Anderson worked for
G.M.
Now there is not a single G.M. plant left, and just two parts plants that
G.M. once owned still survive. Anderson, about 50 miles northeast of
Indianapolis, had 70,000 people in 1970 and now has fewer than 58,000.
But in many ways, Anderson is still just as dependent on G.M. as it once was.
Only now, rather than being dependent on General Motors, the corporation, it is
dependent on General Motors, the welfare state.
The company’s generous medical plans, prescription drug coverage, dental care
and pension checks are a lifeline for the 10,000 G.M. retirees and an untold
number of surviving spouses and other family members who still live in the
Anderson area.
Read more…
