Is there anyone left in Washington who actually wants the United States to experience economic recovery? We're already up to our noses in rising water, and this would dump buckets more down on our heads...so why aren't we hearing anyone in Congress calling attention to this or rounding up opposition? All I hear is crickets.Erick Erickson at RedState has a list of Blue Dog Democrats that have opposed the Obama administration's $100 billion bailout of the International Monetary Fund, but who are now wavering. Why? According to Erick's sources, Obama chief of staff Rahm Emanuel has come to Capitol Hill as Monty Hall, playing Let's Make a Deal to get the IMF bailout passed.
Even if we could afford all of the cash we've spent bailing out our own financial institutions, we can't afford to bail out Europe at the same time. The IMF bailout would do nothing for our own financial strength; in fact, as a breaking report from the Wall Street Journal shows, we'd essentially be funding an attack on the dollar:
Brazil and Russia are set to unload U.S. Treasury bonds as they acquire $10 billion each of new International Monetary Fund securities designed to bolster the institution's aid programs, officials in the countries said Wednesday.
The moves are part of a bid by the so-called BRIC nations — Brazil, Russia, India and China — to play a bigger role at the IMF and other international institutions. The announcements helped push Treasury yields to their highest level this year on concern that rising U.S. debt has hurt T-bill demand among big holders of U.S. dollar reserves.
Instead of just holding the $100 billion and demonstrating a modicum of fiscal sanity, we would act to strengthen the competition to Treasuries. The US has had to pay out higher yields on these bonds precisely because investors have less confidence in our ability to repay, thanks to wild spending by the Obama administration. Now Brazil and Russia plan to dump Treasuries on the market in favor of IMF securities — and we're going to make the IMF bonds more attractive by increasing the deficit spending that created the impulse to dump the Treasuries? In what universe does anyone think this is a sane and rational policy?
There's my two cents.
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