in my line of work you got to keep repeating things over and over
and over again for the truth to sink in, to kind of catapult the
Bush, at the Athena Performing Arts Center at Greece Athena Middle
and High School Tuesday, May 24, 2005 in Rochester, NY
he departs the White House on 20 January, 2009, the current resident
will bequeath to the American people and the next administration
an interminable war in the Middle East and a depreciated currency.
that's the good news. It assumes there is a successor administration
and that no Cheney-contrived "national emergency" will make it
possible for Bush to test drive National Security Presidential
Directive/NSPD-51 and Homeland Security Presidential Directive/HSPD-20
to cancel the 2008 election.
led by vice president Dick Cheney remain determined to effect
"regime change" in Iran. The allegation of weapons of mass destruction
falsely brought against Iraq is now being deployed against Iran.
International Atomic Energy Agency says that there is no evidence
that Iran has a nuclear weapons program. The IAEA is the institution
that polices the Nuclear Non-proliferation Treaty by inspecting
the nuclear facilities of the signatories to the treaty of which
Iran is one. However, the neocon/Cheney/Bush regime is prepared
to bomb Iran on the basis of fibs alone.
repeated by the propaganda ministry that masquerades as the "mainstream
media," those fibs have been trotted out so many times in recent
months that significant numbers of Americans now believe themselves
to be in peril from nonexistent Iranian nukes.
this way the regime gains the complicity of the American people
and their representatives in Congress for what will be unprovoked
aggression against a third Middle Eastern country, a third war
crime under the Nuremberg standard.
"Cakewalk War" in Iraq was supposed to be over in a few
weeks and to pay for itself out of Iraqi oil revenues. The
war is now five years old and has cost America US$1 trillion.
However, this cost pales in comparison to the damage the
war has done to the value of the dollar and its role as
"war on terror" is a hoax. It serves as a cover for the drive
for US and Israeli hegemony in the Middle East. Iraq, Iran, and
Syria became neoconservative targets, because they were the only
Middle Eastern countries that are not American puppet states or
was attacked, because the Taliban were uniting the country under
the banner of Islam, a development that, if successful, could
lead to the overthrow of the governments in America's puppet states
war rhetoric against Iran ratcheted up when the White House belatedly
realized that the result of "bringing democracy to Iraq" was to
empower the majority Shi'ites, thereby creating a Shi'ite crescent
from Iran to southern Lebanon and alarming America's Sunni Saudi
goal is to have the Americans eliminate the Muslim states that
support Hamas and Hezbollah's opposition to Israel's theft of
the remainder of Palestine and southern Lebanon, whose water resources
Israel covets. Israel's goal thus precisely coincides with that
of the Cheney regime.
"Cakewalk War" in Iraq was supposed to be over in a few weeks
and to pay for itself out of Iraqi oil revenues. The war is now
five years old and has cost American taxpayers, and those left
dependent on government programs by decades of a welfare state,
US$1 trillion in out-of-pocket and already incurred future costs.
large and troublesome as this cost is, it pales in comparison
to the damage the war has done to the value of the dollar and
its role as reserve currency. Since 2001, the Euro has risen 60
per cent against the dollar.
US dollar is losing its reserve currency role when the Euro,
the currency of a nonexistent country - Europe - becomes
so much more desirable than the dollar that it rises 60
per cent in value. It is not normal for people to flee from
the reserve currency. It only happens when people believe
it cannot continue to fill that role.
means much more to Americans than the higher cost of a European
vacation and status symbol German cars. The US dollar is losing
its reserve currency role when the Euro, the currency of a nonexistent
country - Europe - becomes so much more desirable than the dollar
that it rises 60 per cent in value.
Euro is a monetary unit that has run far ahead of the political
entity whose currency it is. Europe still consists of separate
sovereign states, and many of them are unhappy with the Euro.
Yet, since 2001 people throughout the world have been shifting
from dollars to Euros.
is not normal for people to flee from the reserve currency. It
only happens when people believe it cannot continue to fill that
US dollar is under double assault. One assault is from the offshoring
of American jobs, which turns US GDP into foreign GDP and worsens
the US trade deficit. It is not possible to achieve a trade balance
when the production of goods and services for the US market is
being moved offshore by US corporations.
other assault is from the US budget deficit. Americans have become
so hard pressed that their savings rate is negligible. The US
government has to rely on foreigners to lend it money for its
annual expenditures. Washington's two biggest bankers are China
and Japan, the countries with the largest trade surpluses with
transformation of the Iraq "cakewalk" into an interminable war
has run up a one trillion dollar price tag, and an even larger
war with Iran is looming. US generals and neoconservative ideologues
predict a decade or multi-decade long war in the Middle East.
Washington's bankers are waking up to the reality that they will
not be repaid.
US dollar is under double assault. One assault is from the
offshoring of American jobs, which turns US GDP into foreign
GDP and worsens the US trade deficit. The other assault
is from the US budget deficit. The US government has to
rely on foreigners to lend it money for its annual expenditures.
Washington's two biggest bankers are China and Japan, the
countries with the largest trade surpluses with the US.
only reason the dollar has not already lost its reserve currency
role is that the only alternative is the currency of a non-existent
political entity. Yet, even the Euro, a virtual currency, may
have taken the dollar's role by the end of 2008.
of hegemonic hubris, the US government does not understand that
US power and hegemony have always depended, not on missiles and
military force, but on the financial power conveyed by the dollar's
role as reserve currency.
reserve currency is world money, good in any country to pay any
bill. The reserve currency country is not a debtor in the usual
sense. As the reserve currency can be used to settle international
accounts, the reserve currency country can borrow at will until
lenders lose confidence in the currency.
is abundant evidence that the loss of confidence in the dollar
is underway. When it is complete, the US will no longer be a superpower.
decline in American power and influence could be dramatic. Part
of America's power results from European countries going along
with Washington. However, the sharp rise in the Euro's value has
hurt European exports, squeezing profit margins, wages, and encouraging
offshore production. Fights over monetary policy between European
capitals could doom both the EU and the Euro, leaving the world
with no reserve currency and America with embittered former allies.
going to war for hegemony, the Bush Regime has brought about American
decline. While the neocons have spent two administrations trying
to deracinate Islam, real threats to America's power have been
neglected. Offshoring, which turns US GDP into imports and larger
trade deficits, together with war debts, has eroded the dollar's
status as reserve currency, undermining the foundation of American
Paul Craig Roberts was Assistant Secretary of the Treasury in
the Reagan administration. He was Associate Editor of the Wall
Street Journal editorial page and Contributing Editor of National
Review. He is coauthor of The
Tyranny of Good Intentions. He can be reached at: [email protected]
articles by Paul Craig Roberts:
Hypocrisy Rules The West
American Economy, R.I.P.
The War Criminal In The Living Room
More War On The Horizon
China Is Not The Problem
China's Threat To The Dollar Is Real
In The Hole To China
A Free Press Or A Ministry Of Truth?