"Starve the Beast" mentality

Alan Greenspan has proven himself to be a partisan hack as Paul Krugman's latest column demonstrates:

Four years ago, Alan Greenspan urged Congress to cut taxes, asserting that the federal government was in imminent danger of paying off too much debt.

On Wednesday the Fed chairman warned Congress of the opposite fiscal danger: he asserted that there would be large budget deficits for the foreseeable future, leading to an unsustainable rise in federal debt. But he counseled against reversing the tax cuts, calling instead for cuts in Social Security, Medicare and Medicaid.

Does anyone still take Mr. Greenspan's pose as a nonpartisan font of wisdom seriously?

Krugman explains how Bush actually welcomed the deficit when it began because it gave him an excuse to cut domestic spending.

What I don't understand is why so-called conservatives want American streets to look like the streets of Calcutta - with people dying in the gutters and beggars everywhere. Because that is indeed what will happen when we destroy the social safety net.

We also see in this administration the problem with having uneducated people in charge. (Yes, I know Bush has degrees from Yale and Harvard. No, I don't believe for a minute that he actually earned those degrees.) Obviously no one planning to "starve the beast" of the New Deal has ever read Dickens. Or maybe there is something so deeply wicked in the mentality of Bush and Co. that they really want a large number of people to live in squalor. Why? Will they enjoy their own wealth more if others are suffering? Will it give them some kind of perverse pleasure to see the poor ground into the dust and the middle class destroyed?

Taxes are the dues we pay to live in a civilized society and not to have to step over bodies in the street.

Another article published in Smirking Chimp today about Greenspan is by Mike Whitney entitled, "High Treason at the Federal Reserve". Here's how Mr. Whitney sums things up:

Are we supposed to believe that the looming deficits just appeared on Greenspan's radar screen?

Puh-leeese.

Greenspan knew that the ship-of-state was taking on water long ago, but chose to play along so Bush could fund his war on money borrowed from our children. You see, robbing from the elderly and infirm is not enough for the wily Greenspan; he likes to make sure that the last brass farthing is drained from the toddler's piggy-bank.

Greenspan's stewardship at the Federal Reserve has been an incalculable disaster. The dollar has weakened by over 30% to the Euro, (Central banks are steadily reducing their share of dollars) deficits are soaring, and the country is teetering towards an Argentina-type meltdown. Greenspan's policies have been a boon to the rich and powerful, and his unexplainably low interest rates have benefited the administration's war mongers. But, the dollar has taken a drubbing, energy costs are on their way up, the job market is soft and the nation is deeper in debt than any country in the history of civilization.

Sometime in the next few years the rug is going to be pulled out from under the American economy and we'll all be left gasping for air in a sea of red ink.

What worries me is the astronomical number of our treasury bonds that are held by China and Japan. In other words, they are financing our deficit. What happens when they decide to call in their dollars? It is a terrifying prospect.