In 1987 I published a book titled Planet Of The Financial Planners. It was a collection of short satirical pieces, most of which had run in publications such as The Wall Street Journal, Los Angles Times, Boston Globe and a few other newspapers.
Among the original pieces that hadn’t run elsewhere and that appeared in this book for the first time was one titled “Facing Up To The Man From Chad.” I reproduce that piece here:
…The formal announcement came in late 1985. The United States was a debtor nation for the first time in 71 years. After that things moved fast. By the first quarter of 1986, we were the world’d largest largest debtor, and have been steadily adding to the pile ever since.
Our slide from international balance of payments grace in recent years has been spectacular and has produced a number of unpleasant consequences, ranging from increased unemployment to historically high interest rates. Such consequences, however, have been mitigated to a large extent by another factor — the willingness of foreigners to pour enough capital into this country to compensate for our huge trade shorfalls.
But how long can this continue? How long will it be before a consortium of foreign bankers decides that the interests if their countries’ widows and shoeshine boys whose pengos and pesetas it manages are being endangered by our profligate habits, and that the plug has to be pulled? When a government and its people show themselves unable to control their own appetites, after all, a prudent dose of outside discipline is usually required to set things straight
One can easily imagine the scene at the Dulles International Airport [*now the Reagan International Airport] when the Secretary of the Treasury goes to meet the delegation sent to put our national house in order. His forehead creased, his throat dry, his hands convulsively twisting the brim of a homburg, he forces a smile as the door of the plane opens, only to have it fade as he recognizes the first man on the tarmac.
“My God,” groans the Secretary. “They’ve sent someone from the Bank of Chad. I’m going to die.”
A nation like our own, with 10,000 nuclear warheads, is never totally without recourse when it comes to vindictive creditors. They can be held at bay indefinitely if need be. But there’s a psychological price to be paid for doing so. And therein lies the real rub of our prevent deficit dilemma.
Americans have financed a huge military buildup in recent years. A primary objective of this spending was to improve our national image. The way we think of ourselves. To help us “stand tall.”
But how tall can you stand when the financial dingos are nipping at your heels and their dunning notices are broadcast worldwide on the evening news?
In the end, it may not be the deficit-induced loss of prosperity that puts Americans out of sorts. It might just be the tittering of the neighbors…
The above piece appeared in a book I published a quarter century ago. Even then it was obvious where this country’s national finances were headed.
So here we are a quarter century latter. Our Triple-A credit rating has just been pulled. The instrument of this national shame is not a banker from Chad, but a credit rating agency with about the same intrinsic claim to international status.
Are you surprised? Why would you be. Why would anyone be. Looking back at the way this country has managed its foreign affairs in recent decades, its spending proclivities, its taxing priorities, anyone who is surprised by the just announced national credit downgrade has surely been living in deep, deep denial.
More from (and about) this writer at http://cootavengers.com/