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Opening Arguments

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Common sense from Michael Kinsley:

But even if the stimulus is a magnificent success, the money still has to be paid back. The plan of record apparently is that we keep borrowing, spending and stimulating, faster and faster, until suddenly, on some signal from heaven or Timothy Geithner, we all stop spending and start saving in recordbreaking amounts. Oh sure, that will work.

There is another way. If it's not the actual, secret plan, it will be an overwhelming temptation: Don't pay the money back. So far, even as one piggy bank after another astounds us with its emptiness, there have been only the faintest whispers about the possibility of an actual default by the U.S. government. Somewhat louder whispers can be heard, though, about the gradual default known as inflation. Just three or four years of currency erosion at, say, 10 percent a year would slice the real value of our debt -- public and private, U.S. bonds and jumbo mortgages -- in half.

Anyone who regards the prospect of double-digit inflation with insouciance is either too young to have lived through it the last time (the late 1970s) or too old to remember. Among other problems, inflation works only as a surprise or betrayal. It can never be part of any public, official plan. Plan for 10 percent inflation, and you'll get 20. Plan for 20 and you'll need a wheelbarrow to pay for your morning Starbucks. But if that's not the plan, what is?

As he says eleswhere in the piece, more succinctly, "money well spent is still money spent."


Michael B-P
Fri, 02/20/2009 - 5:18pm

Of course, what the hell do I know? But it all makes sense, in a perverse, dialectic sort of way: deprive people of their livelihoods so that commodity prices tank and the currency deflates; then spend all that dough we don't have to inflate the bejeez out of the currency. Presto: the Twinkie-and-a Tab road to better economic health!

While we're onto Their conspiracies: kick those nasty oil producers in the cojones by blowing up their portfolios, then kick them in the head by sinking the price of crude from $144 to $40. Man, those Reptilian Shape-Shifting-Skull-and-Bones Evil Geniuses sure do have their acts together, don't they? PS: I sure do wish Bubba was back!