So the U.S. government, which would borrow 42 cents of every dollar it spends under the president’s 2011 budget, is borrowing to rescue Greece and others from the consequences of their borrowing.
Greece, whose gross domestic product is below that of the Dallas-Fort Worth metropolitan area, is “too big to fail,” meaning too inconveniently connected to too many big banks. Bailing out Greece really rescues European banks that improvidently bought Greek bonds. Visit http://tinyurl.com/2dzaul2 for a useful New York Times graphic illustrating how European nations borrow from one another. For example, Italy owes France (French banks) $511 billion, a sum nearly equal to 20 percent of France’s GDP. About one-third of Portugal’s debt is held by Spain, which has $238 billion of its debt held by Germany and $220 billion by France. Russell Roberts of George Mason University notes that this “discourages prudence and wariness” because when “everyone has financed everyone else, you can justify bailing everyone out.”
So recent you can still taste the bile
- It’s easy to forget that both major parties are hot messes at the moment.
- There are certain harms that are nonactionable
- Ike’s opinion of Lee – interesting
- When “individuals are abstract and utopian fantasies regnant”
- When nuance is unacceptable and clarity essential
- Astronomy pictures of the fortnight, LXXII – solar eclipse edition
- RCAAs and Plutonomies
- Bipartisan solution to Obamacare
- Trauma, chaos; new consensus to follow?
- Better deal rebranding