The Billion-Dollar Loser by Gary North

"AND THE WINNER GETS. . . ."

The winner of the 2012 election will get to oversee a Federal deficit of something in the range of $1.5 trillion per year. Maybe it will be less, but not much less. Maybe it will be more. But the round number of $1.5 trillion would have been inconceivable as recently as 2007.

Here is an unsustainable situation. The ability of the United States government to sell its debt at anywhere from six one-hundredths of a percent (90-day T-bills) to under 3.5% (10-year T-bonds) is chronologically limited. It can do this today. No one thinks it can do this for half a decade – not with the balance of payments deficit at $500 billion a year and the on-budget, admitted deficit of $1.65 trillion for fiscal 2011.

There are two American wars in progress. One is in Afghanistan, with no end in sight. The other is in Iraq, where there are 47,000 uniformed troops plus 100,000 mercenaries of various kinds. Secretary of Defense Gates recently said that there is no timetable for withdrawal, which President Obama said in 2009 would take place by December 31, 2011, a fact that the dutiful mainstream media have dropped down the memory hole.

Secretary Gates said that withdrawal will take place when the Iraqi government asks us to leave. That means the twelfth of never.

The winner of the 2012 election will get to take the heat for the economy of 2013-16. All those who are associated with the victor's politics will get to be the targets of electoral blowback in 2016.

The Billion-Dollar Loser by Gary North