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	<title>Comments on: The coming debt blowup by the US government</title>
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	<link>http://www.samizdata.net/2009/08/the-coming-debt/</link>
	<description>A blog for people with a critically rational individualist perspective</description>
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		<title>By: Paul Marks</title>
		<link>http://www.samizdata.net/2009/08/the-coming-debt/#comment-192339</link>
		<dc:creator>Paul Marks</dc:creator>
		<pubDate>Thu, 27 Aug 2009 15:47:51 +0000</pubDate>
		<guid isPermaLink="false">http://192.168.200.139/?p=12734#comment-192339</guid>
		<description><![CDATA[Getting rid of the entire United States military (some 4% of G.D.P.) will not save the fiinances of the United States even in the short term. Between them Bushbrain (accidentally) and Comrade Barack Obama (deliberately) have seen to that.  Although it would hand over Europe to Putin and Asia to the People&#039;s Republic of China - not good.

But then the Pentagon is not even bothering to buy F22s (because they are not useful against terrorists in Afghanistan) so it is going to be little help against (say) China in a few years anyway.

As for default - as I have already said.....

It is already happening - if you &quot;monetarize the debt&quot; (i.e. create money, out of thin air, to buy up government debt with) that is a de facto default.

And both the British and American governments (via the Central Banks) are doing this.]]></description>
		<content:encoded><![CDATA[<p>Getting rid of the entire United States military (some 4% of G.D.P.) will not save the fiinances of the United States even in the short term. Between them Bushbrain (accidentally) and Comrade Barack Obama (deliberately) have seen to that.  Although it would hand over Europe to Putin and Asia to the People&#8217;s Republic of China &#8211; not good.</p>
<p>But then the Pentagon is not even bothering to buy F22s (because they are not useful against terrorists in Afghanistan) so it is going to be little help against (say) China in a few years anyway.</p>
<p>As for default &#8211; as I have already said&#8230;..</p>
<p>It is already happening &#8211; if you &#8220;monetarize the debt&#8221; (i.e. create money, out of thin air, to buy up government debt with) that is a de facto default.</p>
<p>And both the British and American governments (via the Central Banks) are doing this.</p>
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		<title>By: PersonFromPorlock</title>
		<link>http://www.samizdata.net/2009/08/the-coming-debt/#comment-192338</link>
		<dc:creator>PersonFromPorlock</dc:creator>
		<pubDate>Tue, 25 Aug 2009 01:45:02 +0000</pubDate>
		<guid isPermaLink="false">http://192.168.200.139/?p=12734#comment-192338</guid>
		<description><![CDATA[Actually, I&#039;m quite proud of &quot;detesticate.&quot; Not every new word in English should come into being through typos in the MSM.]]></description>
		<content:encoded><![CDATA[<p>Actually, I&#8217;m quite proud of &#8220;detesticate.&#8221; Not every new word in English should come into being through typos in the MSM.</p>
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		<title>By: Marty</title>
		<link>http://www.samizdata.net/2009/08/the-coming-debt/#comment-192337</link>
		<dc:creator>Marty</dc:creator>
		<pubDate>Mon, 24 Aug 2009 20:03:06 +0000</pubDate>
		<guid isPermaLink="false">http://192.168.200.139/?p=12734#comment-192337</guid>
		<description><![CDATA[US debt default is long-range, the more immediate issue will be when people &#039;round the world start not accepting dollars---the dollar loses its privileged status as the world&#039;s reserve currency. Already straws in the wind, and more, from China, Russia, and others. When it happens, it&#039;ll happen quite suddenly, not because of conspiracy but because as soon as it is known that a major player (govt or corporation) has lost confidence, everyone will head for the exits. Much like a bank run.

This will happen by surprise, tho after the fact it will seem predictable (like Northern Rock or Bear Stearns or Lehman). It&#039;ll develop over the course of a few days, couple of weeks at most, and then we enter the brave new world. The US won&#039;t be able to keep running $700B trade deficits, which will threaten to knock the props from under China as well as an instant 5% reduction in the US economy, and the rest of the world will scramble to figure out how to deal with existing dollar-denominated contracts and to find an alternative.
]]></description>
		<content:encoded><![CDATA[<p>US debt default is long-range, the more immediate issue will be when people &#8217;round the world start not accepting dollars&#8212;the dollar loses its privileged status as the world&#8217;s reserve currency. Already straws in the wind, and more, from China, Russia, and others. When it happens, it&#8217;ll happen quite suddenly, not because of conspiracy but because as soon as it is known that a major player (govt or corporation) has lost confidence, everyone will head for the exits. Much like a bank run.</p>
<p>This will happen by surprise, tho after the fact it will seem predictable (like Northern Rock or Bear Stearns or Lehman). It&#8217;ll develop over the course of a few days, couple of weeks at most, and then we enter the brave new world. The US won&#8217;t be able to keep running $700B trade deficits, which will threaten to knock the props from under China as well as an instant 5% reduction in the US economy, and the rest of the world will scramble to figure out how to deal with existing dollar-denominated contracts and to find an alternative.</p>
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		<title>By: Marty</title>
		<link>http://www.samizdata.net/2009/08/the-coming-debt/#comment-192336</link>
		<dc:creator>Marty</dc:creator>
		<pubDate>Mon, 24 Aug 2009 19:42:12 +0000</pubDate>
		<guid isPermaLink="false">http://192.168.200.139/?p=12734#comment-192336</guid>
		<description><![CDATA[US debt default is long-range, the more immediate issue will be when people &#039;round the world start not accepting dollars---the dollar loses its privileged status as the world&#039;s reserve currency.  Already straws in the wind, and more, from China, Russia, and others.  When it happens, it&#039;ll happen quite suddenly, not because of conspiracy but because as soon as it is known that a major player (govt or corporation) has lost confidence, everyone will head for the exits.  Much like a bank run.

This will happen by surprise, tho after the fact it will seem predictable (like Northern Rock or Bear Stearns or Lehman).  It&#039;ll develop over the course of a  few days, couple of weeks at most, and then we enter the brave new world.  The US won&#039;t be able to keep running $700B trade deficits, which will threaten to knock the props from under China as well as an instant 5% reduction in the US economy, and the rest of the world will scramble to figure out how to deal with existing dollar-denominated contracts and to find an alternative.]]></description>
		<content:encoded><![CDATA[<p>US debt default is long-range, the more immediate issue will be when people &#8217;round the world start not accepting dollars&#8212;the dollar loses its privileged status as the world&#8217;s reserve currency.  Already straws in the wind, and more, from China, Russia, and others.  When it happens, it&#8217;ll happen quite suddenly, not because of conspiracy but because as soon as it is known that a major player (govt or corporation) has lost confidence, everyone will head for the exits.  Much like a bank run.</p>
<p>This will happen by surprise, tho after the fact it will seem predictable (like Northern Rock or Bear Stearns or Lehman).  It&#8217;ll develop over the course of a  few days, couple of weeks at most, and then we enter the brave new world.  The US won&#8217;t be able to keep running $700B trade deficits, which will threaten to knock the props from under China as well as an instant 5% reduction in the US economy, and the rest of the world will scramble to figure out how to deal with existing dollar-denominated contracts and to find an alternative.</p>
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		<title>By: Laird</title>
		<link>http://www.samizdata.net/2009/08/the-coming-debt/#comment-192335</link>
		<dc:creator>Laird</dc:creator>
		<pubDate>Mon, 24 Aug 2009 05:52:40 +0000</pubDate>
		<guid isPermaLink="false">http://192.168.200.139/?p=12734#comment-192335</guid>
		<description><![CDATA[Thank you for that explanation, PFP. I think you and are are largely in agreement (I am no anarchist). With respect to Korea, however, I don&#039;t understand just whom you think we would be &quot;appeasing&quot; by a withdrawal of our troups. Certainly not China. North Korea? Perhaps, but so what? South Korea is more than capable of defending itself these days. 

Japan is, too; its military forces may be called &quot;police&quot; but they are nonetheless very potent. Japan has long outgrown its military expansionist tendencies. It is a westernized, capitalist nation now, and we are as far from its WW2 atrocities as we are from Germany&#039;s. Three generations is long enough for everyone to have gotten over it.

I agree with your point that there should be natural affinities between the US and both India and China, but those are &lt;em&gt;commercial&lt;/em&gt; in nature. Reciprocal trade is a better guarantee of our mutual security than is military posturing, especially the sort conducted through proxies. So I&#039;m still for bringing home all those troops, although I understand that it needn&#039;t happen overnight. We can announce our intentions and gradually reduce our asian troop strength over a period of time, perhaps five years. That would give the region time to adjust to the new dynamic. (And I never said that we couldn&#039;t keep a few nuclear subs cruising around in secret, just in case.)

And in any event, the troops in Europe should all be home by this Christmas.]]></description>
		<content:encoded><![CDATA[<p>Thank you for that explanation, PFP. I think you and are are largely in agreement (I am no anarchist). With respect to Korea, however, I don&#8217;t understand just whom you think we would be &#8220;appeasing&#8221; by a withdrawal of our troups. Certainly not China. North Korea? Perhaps, but so what? South Korea is more than capable of defending itself these days. </p>
<p>Japan is, too; its military forces may be called &#8220;police&#8221; but they are nonetheless very potent. Japan has long outgrown its military expansionist tendencies. It is a westernized, capitalist nation now, and we are as far from its WW2 atrocities as we are from Germany&#8217;s. Three generations is long enough for everyone to have gotten over it.</p>
<p>I agree with your point that there should be natural affinities between the US and both India and China, but those are <em>commercial</em> in nature. Reciprocal trade is a better guarantee of our mutual security than is military posturing, especially the sort conducted through proxies. So I&#8217;m still for bringing home all those troops, although I understand that it needn&#8217;t happen overnight. We can announce our intentions and gradually reduce our asian troop strength over a period of time, perhaps five years. That would give the region time to adjust to the new dynamic. (And I never said that we couldn&#8217;t keep a few nuclear subs cruising around in secret, just in case.)</p>
<p>And in any event, the troops in Europe should all be home by this Christmas.</p>
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		<title>By: veryretired</title>
		<link>http://www.samizdata.net/2009/08/the-coming-debt/#comment-192334</link>
		<dc:creator>veryretired</dc:creator>
		<pubDate>Sun, 23 Aug 2009 23:34:17 +0000</pubDate>
		<guid isPermaLink="false">http://192.168.200.139/?p=12734#comment-192334</guid>
		<description><![CDATA[Ah, a new word for an old condition---either way it makes me shiver.

I&#039;m not sure what Laird is reading into my comment, so I will try to clarify without overly abusing the courtesy of our hosts with another too-lengthy post.

Nato has been meaningless for quite some time, and the idea that the US would risk itself for the safety of Germany or France any longer is delusional. Their relentless anti-Americanism and slanderous backstabbing at every opportunity makes the prospect even more repugnant.

Between their own demographics, and the longing gazes aimed their way by the new Russian aristocracy, there&#039;s not much future to save anyway. Moslem dhimmi&#039;s or Russian vassals, either is better than they deserve.

It&#039;s a shame about the eastern European states that have demonstrated some true desire for a strong relationship with the US, but geography is what it is, and the relatively strong isolationism found in Laird&#039;s comment is widespread in the US now.

Defense of one&#039;s own is a proper function of the state, and I am loath to join those who call for the US to disarm itself in a hostile world, regardless of their oh-so-proper libertarian anti-militarism.

I believe the US still has strong allies, and significant interests in the pacific and Asian regions, not only in trade, but as regards the continuing aggressiveness of islamic jihadists. 

China and India are natural allies in this latter regard, and further interaction may improve their current statism towards a more open system, but only if the US can provide an example of less, not more, state intervention. That certainly will not occur under the current regime.

While I would love to see the long overdue redeployment of troops from Korea, in the current circumstances it would appear as one more instance of appeasement, and, therefore, must be delayed a while yet. 

As much as it appears a burden to continue to guarantee the security of Japan, it is very much in the interests of the US to prevent any aggressive actions either by or toward Japan. 

Disarmed, it would prove an overly tempting apple on a low branch hanging near the Chinese, and re-armed, it would immediately antagonize, if not actually threaten, the several countries nearby which have frequently been the object of Japan&#039;s overly ardent desires.

The best world would have  pacifistic and disarmed cultures in both Germany and Japan, but one out of two may be the best we can do at this point.

There are no perfect choices in this, as in many other areas of international relations. Better to be so strong that none dare attack, than weak and inviting repeated predation.

I have not mentioned many aspects of these questions, in Europe, Asia and the Western Hemisphere, that would be covered if I was writing a thesis or a book. I had hoped to keep this comment from becoming either. ]]></description>
		<content:encoded><![CDATA[<p>Ah, a new word for an old condition&#8212;either way it makes me shiver.</p>
<p>I&#8217;m not sure what Laird is reading into my comment, so I will try to clarify without overly abusing the courtesy of our hosts with another too-lengthy post.</p>
<p>Nato has been meaningless for quite some time, and the idea that the US would risk itself for the safety of Germany or France any longer is delusional. Their relentless anti-Americanism and slanderous backstabbing at every opportunity makes the prospect even more repugnant.</p>
<p>Between their own demographics, and the longing gazes aimed their way by the new Russian aristocracy, there&#8217;s not much future to save anyway. Moslem dhimmi&#8217;s or Russian vassals, either is better than they deserve.</p>
<p>It&#8217;s a shame about the eastern European states that have demonstrated some true desire for a strong relationship with the US, but geography is what it is, and the relatively strong isolationism found in Laird&#8217;s comment is widespread in the US now.</p>
<p>Defense of one&#8217;s own is a proper function of the state, and I am loath to join those who call for the US to disarm itself in a hostile world, regardless of their oh-so-proper libertarian anti-militarism.</p>
<p>I believe the US still has strong allies, and significant interests in the pacific and Asian regions, not only in trade, but as regards the continuing aggressiveness of islamic jihadists. </p>
<p>China and India are natural allies in this latter regard, and further interaction may improve their current statism towards a more open system, but only if the US can provide an example of less, not more, state intervention. That certainly will not occur under the current regime.</p>
<p>While I would love to see the long overdue redeployment of troops from Korea, in the current circumstances it would appear as one more instance of appeasement, and, therefore, must be delayed a while yet. </p>
<p>As much as it appears a burden to continue to guarantee the security of Japan, it is very much in the interests of the US to prevent any aggressive actions either by or toward Japan. </p>
<p>Disarmed, it would prove an overly tempting apple on a low branch hanging near the Chinese, and re-armed, it would immediately antagonize, if not actually threaten, the several countries nearby which have frequently been the object of Japan&#8217;s overly ardent desires.</p>
<p>The best world would have  pacifistic and disarmed cultures in both Germany and Japan, but one out of two may be the best we can do at this point.</p>
<p>There are no perfect choices in this, as in many other areas of international relations. Better to be so strong that none dare attack, than weak and inviting repeated predation.</p>
<p>I have not mentioned many aspects of these questions, in Europe, Asia and the Western Hemisphere, that would be covered if I was writing a thesis or a book. I had hoped to keep this comment from becoming either. </p>
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		<title>By: Laird</title>
		<link>http://www.samizdata.net/2009/08/the-coming-debt/#comment-192333</link>
		<dc:creator>Laird</dc:creator>
		<pubDate>Sun, 23 Aug 2009 23:10:46 +0000</pubDate>
		<guid isPermaLink="false">http://192.168.200.139/?p=12734#comment-192333</guid>
		<description><![CDATA[Ah, &lt;em&gt;now&lt;/em&gt; I take your meaning!]]></description>
		<content:encoded><![CDATA[<p>Ah, <em>now</em> I take your meaning!</p>
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		<title>By: Alisa</title>
		<link>http://www.samizdata.net/2009/08/the-coming-debt/#comment-192332</link>
		<dc:creator>Alisa</dc:creator>
		<pubDate>Sun, 23 Aug 2009 22:18:00 +0000</pubDate>
		<guid isPermaLink="false">http://192.168.200.139/?p=12734#comment-192332</guid>
		<description><![CDATA[Laird, not deeper, just, um, lower...]]></description>
		<content:encoded><![CDATA[<p>Laird, not deeper, just, um, lower&#8230;</p>
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		<title>By: Laird</title>
		<link>http://www.samizdata.net/2009/08/the-coming-debt/#comment-192331</link>
		<dc:creator>Laird</dc:creator>
		<pubDate>Sun, 23 Aug 2009 22:02:06 +0000</pubDate>
		<guid isPermaLink="false">http://192.168.200.139/?p=12734#comment-192331</guid>
		<description><![CDATA[I think I agree, PFP, but I don&#039;t know what &quot;detesticate&quot; means. Perhaps you meant to write &quot;domesticated&quot;? Or is it something deeper than that?]]></description>
		<content:encoded><![CDATA[<p>I think I agree, PFP, but I don&#8217;t know what &#8220;detesticate&#8221; means. Perhaps you meant to write &#8220;domesticated&#8221;? Or is it something deeper than that?</p>
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		<title>By: PersonFromPorlock</title>
		<link>http://www.samizdata.net/2009/08/the-coming-debt/#comment-192330</link>
		<dc:creator>PersonFromPorlock</dc:creator>
		<pubDate>Sun, 23 Aug 2009 19:15:01 +0000</pubDate>
		<guid isPermaLink="false">http://192.168.200.139/?p=12734#comment-192330</guid>
		<description><![CDATA[Laird, my own very idiosyncratic take on NATO is that, by co-opting Europe&#039;s militaries, it kept the European powers from indulging in their usual &quot;Twenty years of sophisticated diplomacy and a mutual lunge for the throat&quot; foreign policies. A European war would surely have invited Soviet intervention &#039;to stabilize the region&#039;, whereas a straight war of conquest was never very likely.

By now, of course, Europe is sufficiently detesticate that NATO is no longer needed.]]></description>
		<content:encoded><![CDATA[<p>Laird, my own very idiosyncratic take on NATO is that, by co-opting Europe&#8217;s militaries, it kept the European powers from indulging in their usual &#8220;Twenty years of sophisticated diplomacy and a mutual lunge for the throat&#8221; foreign policies. A European war would surely have invited Soviet intervention &#8216;to stabilize the region&#8217;, whereas a straight war of conquest was never very likely.</p>
<p>By now, of course, Europe is sufficiently detesticate that NATO is no longer needed.</p>
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		<title>By: Laird</title>
		<link>http://www.samizdata.net/2009/08/the-coming-debt/#comment-192329</link>
		<dc:creator>Laird</dc:creator>
		<pubDate>Sun, 23 Aug 2009 17:24:38 +0000</pubDate>
		<guid isPermaLink="false">http://192.168.200.139/?p=12734#comment-192329</guid>
		<description><![CDATA[I don&#039;t disagree with any of veryretired&#039;s specific points, but from the last part of his post I infer that he thinks that for the US to &quot;draw down&quot; the worldwide deployment of its military forces would be a bad thing. If my reading of that is correct, then I &lt;em&gt;do&lt;/em&gt; disagree with him there. 

Many of us have argued for a long time that the US government shouldn&#039;t be spending our tax dollars being &quot;the world&#039;s policeman&quot;, let alone in trying to force our brand of governance on the rest of the world. NATO outlived whatever utility it may once have had when the Berlin Wall fell and the Soviet Union collapsed; we should withdraw from it and remove all of our troops in Europe. Same with SEATO (if it even still exists and which, as far as I can see, &lt;em&gt;never&lt;/em&gt; had any utility). Japan can defend itself, as can South Korea. Bring &lt;em&gt;all&lt;/em&gt; those troops home, and muster them out of the military; you* can fight your own fights. And also abolish the purile joke which the UN has become. Please.

In fact, the US is the largest market in the world, and the dollor is (at least for now) the world&#039;s &lt;em&gt;de facto&lt;/em&gt; reserve currency. Our collapse would be terrible for us but a total disaster for you. If anything, &lt;em&gt;you&lt;/em&gt; should be defending &lt;em&gt;us&lt;/em&gt;.

* I don&#039;t know veryretired&#039;s nationality, so this isn&#039;t directed to him personally; when I use &quot;you&quot; here it is intended to mean everyone outside the US.]]></description>
		<content:encoded><![CDATA[<p>I don&#8217;t disagree with any of veryretired&#8217;s specific points, but from the last part of his post I infer that he thinks that for the US to &#8220;draw down&#8221; the worldwide deployment of its military forces would be a bad thing. If my reading of that is correct, then I <em>do</em> disagree with him there. </p>
<p>Many of us have argued for a long time that the US government shouldn&#8217;t be spending our tax dollars being &#8220;the world&#8217;s policeman&#8221;, let alone in trying to force our brand of governance on the rest of the world. NATO outlived whatever utility it may once have had when the Berlin Wall fell and the Soviet Union collapsed; we should withdraw from it and remove all of our troops in Europe. Same with SEATO (if it even still exists and which, as far as I can see, <em>never</em> had any utility). Japan can defend itself, as can South Korea. Bring <em>all</em> those troops home, and muster them out of the military; you* can fight your own fights. And also abolish the purile joke which the UN has become. Please.</p>
<p>In fact, the US is the largest market in the world, and the dollor is (at least for now) the world&#8217;s <em>de facto</em> reserve currency. Our collapse would be terrible for us but a total disaster for you. If anything, <em>you</em> should be defending <em>us</em>.</p>
<p>* I don&#8217;t know veryretired&#8217;s nationality, so this isn&#8217;t directed to him personally; when I use &#8220;you&#8221; here it is intended to mean everyone outside the US.</p>
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		<title>By: veryretired</title>
		<link>http://www.samizdata.net/2009/08/the-coming-debt/#comment-192328</link>
		<dc:creator>veryretired</dc:creator>
		<pubDate>Sun, 23 Aug 2009 00:20:47 +0000</pubDate>
		<guid isPermaLink="false">http://192.168.200.139/?p=12734#comment-192328</guid>
		<description><![CDATA[The current financial situation in the US is not sustainable. The major entitlement programs already in operation, such as social security and medicare/medicaid, will go bust sometime over the next few decades.

Any new programs, such as Obamacare, or other major entitlements as yet only proposed, but not enacted, will only hasten and make more severe the collapse.

The last several administrations have operated under the assumption that the wealth of the country was some sort of magical spring which could never go dry, but would always refill itself to satisfy any requirements the various levels of government might make of it.

Various states within the country are now experiencing the consequences of this kind of thinking, as the businesses which create jobs and wealth either close up or leave their high tax/poor services environments for more open spaces, either foreign or domestic.

If the current political viewpoint acsendent in the country remains the general approach, one of the major effects our various allies and friends around the world will notice soon is that the US is drawing down its military forces, and will no longer be able to be relied upon for major efforts in situations of mutual assistence and military aid.

Many around the world have been asking for exactly that, especially in Europe. You are going to get your wish over the next several years. 

At some point in the near future, when threatened by agression or terrorism by any of the ususal suspects, the response of the US will be &quot;Good luck and godspeed.&quot; 

You asked for it, you got it. ]]></description>
		<content:encoded><![CDATA[<p>The current financial situation in the US is not sustainable. The major entitlement programs already in operation, such as social security and medicare/medicaid, will go bust sometime over the next few decades.</p>
<p>Any new programs, such as Obamacare, or other major entitlements as yet only proposed, but not enacted, will only hasten and make more severe the collapse.</p>
<p>The last several administrations have operated under the assumption that the wealth of the country was some sort of magical spring which could never go dry, but would always refill itself to satisfy any requirements the various levels of government might make of it.</p>
<p>Various states within the country are now experiencing the consequences of this kind of thinking, as the businesses which create jobs and wealth either close up or leave their high tax/poor services environments for more open spaces, either foreign or domestic.</p>
<p>If the current political viewpoint acsendent in the country remains the general approach, one of the major effects our various allies and friends around the world will notice soon is that the US is drawing down its military forces, and will no longer be able to be relied upon for major efforts in situations of mutual assistence and military aid.</p>
<p>Many around the world have been asking for exactly that, especially in Europe. You are going to get your wish over the next several years. </p>
<p>At some point in the near future, when threatened by agression or terrorism by any of the ususal suspects, the response of the US will be &#8220;Good luck and godspeed.&#8221; </p>
<p>You asked for it, you got it. </p>
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