Getting Fat on a Hunger Strike

Posted: May 15, 2009, 6:51AM



President Barack Obama called current deficit spending “unsustainable” and warned of skyrocketing interest rates if the U.S. continues to finance government by borrowing from other countries.

At a town-hall meeting Thursday in Rio Rancho, New Mexico the President said, “We can’t keep on just borrowing from China.  We have to pay interest on that debt, and that means we are mortgaging our children’s future with more and more debt.”

At first glance, it would appear that this popular warning for our children’s wallets was another right wing attack against the President's own out-of-control budget deficit spending.

Just earlier this week the Obama administration revised it’s own budget deficit spending by $89 billion, a 5 percent jump from its February estimate.  The new $1.8 trillion dollar figure, which amounts to borrowing almost 50 cents for every dollar it spends this year, is about four times the budget deficit for 2008.

On top of that, the White House said the deficit for the 2010 budget year beginning in October will worsen by $87 billion to $1.3 trillion.  At this hour, that takes next year’s budget from its previous estimate of $3.55 trillion to $3.59 trillion.

The President said that holders of U.S. debt will eventually “get tired” of buying it, causing interest rates to increase on everything from auto loans to home mortgages.  “It will have a dampening effect on our economy.”

Getting "tired” of buying our debt isn’t exactly how China put it when President Obama sent Secretary of State Hillary Clinton there in February to plead that they keep on giving.

“It’s a safe investment,” Clinton said.  “The United States has a well-deserved financial reputation.”

Before seeing red in China, the President should give a serious hello to scarlet between our shores first. This unprecedented red ink flows from his bailouts, to his stimulus bill, to the imbalance he’s creating between what the government spends and what it takes in.

China doesn’t want to assume the risk anymore and who could blame them?  They probably read the consumer report on President Obama and concluded that to invest in the U.S. under his watch would be like buying shares of his GM and Chrysler companies right now.

The premise of this masterful politician in Rio Rancho is that the Chinas of the world are waiting in lines longer than the lines for the new Star Trek flick to snatch some good old fashion “red” white and blue. The reality is there are no lines.  President Obama’s disregard for other peoples’ money has kept smart money people from far away, far, far away.

The bottom line is that President Obama is once again deflecting blame from himself before the inevitable hell breaks loose.  His own unprecedented spending and outrageous budget is not only going to be responsible for the skyrocketing interest rates he is blaming on offshore borrowing, but also for ridiculous inflation that will cause all of our assets to lose tremendous value.

Additionally, while ripping his own spending policy to shreds, President Obama is setting the stage for massive tax hikes.  There is no way this huge debt can be sustained and paid down without increasing taxes on anything and everyone.

In New Mexico Thursday, President Obama told the truth while not being entirely honest.  Indeed, interest rates are going to skyrocket.  Our economy will “dampen” as if it hasn’t already passed the “dampening” point, whatever that is supposed to mean.  If it is because of too much borrowing from foreign countries then why ask Hillary to get on her knees in Asia?

To suggest, Mr. President, that “we are mortgaging our children’s future with more and more dept” because we’re borrowing from China while ignoring the very financial chasm you are creating with your own out-of-control spending in your quest to nationalize our country in your radical, socialist vision is like announcing to America in Rio Rancho that you have started a hunger strike while sitting at a dinner table munching on a feast fit for a king.

Chuck

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