georgephillip
Diamond Member
What happens when a domestic class war meets a global oil war?
Michael Hudson, former Wall Street economist and current professor at UMKC,:
"To begin with the most obvious question: If governments run up their debt in the process of carrying out programs that Congress already approved, why would Congress have yet another option to stop the government from following through on these authorized expenditures, by refusing to raise the debt ceiling?
"The answer is obvious when one looks at why this fail-safe check was introduced in almost every country of the world. Throughout modern history, war has been the major cause of a rising national debt.
"Most governments operate in fiscal balance during peacetime, financing their spending and investment by levying taxes and charging user fees. War emergencies push this balance into deficit sometimes for defensive wars, sometimes for aggression...
"Here was precisely the situation for which the debt ceiling rule was introduced in 1917.
"President Wilson had taken the United States into the Great War, breaking his election campaign promise not to do so. Isolationists in the United States sought to limit Americas commitment, by imposing Congressional oversight and approval of raising the debt ceiling.
"This safeguard obviously was intended to be used against unscheduled spending that occurred without Congressional approval.
"The present rise in U.S. Treasury debt results from two forms of warfare.
"First is the overtly military Oil War in the Near East, from Iraq to Afghanistan (Pipelinistan) to oil-rich Libya. These adventures will end up costing between $3 and $5 trillion.
"Second and even more expensive is the more covert yet more costly economic war of Wall Street against the rest of the economy, demanding that losses by banks and financial institutions be passed onto the government balance sheet ('taxpayers').
"The bailouts and 'free lunch' for Wall Street by no coincidence, Congresss number one political campaign contributor cost $13 trillion."
Maybe it's time to impose a War Tax on the richest 1% of Americans?
CounterPunch: Tells the Facts, Names the Names
Michael Hudson, former Wall Street economist and current professor at UMKC,:
"To begin with the most obvious question: If governments run up their debt in the process of carrying out programs that Congress already approved, why would Congress have yet another option to stop the government from following through on these authorized expenditures, by refusing to raise the debt ceiling?
"The answer is obvious when one looks at why this fail-safe check was introduced in almost every country of the world. Throughout modern history, war has been the major cause of a rising national debt.
"Most governments operate in fiscal balance during peacetime, financing their spending and investment by levying taxes and charging user fees. War emergencies push this balance into deficit sometimes for defensive wars, sometimes for aggression...
"Here was precisely the situation for which the debt ceiling rule was introduced in 1917.
"President Wilson had taken the United States into the Great War, breaking his election campaign promise not to do so. Isolationists in the United States sought to limit Americas commitment, by imposing Congressional oversight and approval of raising the debt ceiling.
"This safeguard obviously was intended to be used against unscheduled spending that occurred without Congressional approval.
"The present rise in U.S. Treasury debt results from two forms of warfare.
"First is the overtly military Oil War in the Near East, from Iraq to Afghanistan (Pipelinistan) to oil-rich Libya. These adventures will end up costing between $3 and $5 trillion.
"Second and even more expensive is the more covert yet more costly economic war of Wall Street against the rest of the economy, demanding that losses by banks and financial institutions be passed onto the government balance sheet ('taxpayers').
"The bailouts and 'free lunch' for Wall Street by no coincidence, Congresss number one political campaign contributor cost $13 trillion."
Maybe it's time to impose a War Tax on the richest 1% of Americans?
CounterPunch: Tells the Facts, Names the Names