re: #384 austin_blue

You miss the point. They are buying our debt at 3.5%. If they, and the rest of the world, refuse to buy our debt at that level, and demand a higher return on our bonds, say 6-7%, our debt service ratio goes through the roof and we are truly in the shitter. We simply cannot continue to run this debt service ratio as we are doing now. Unless we increases government revenues (and the only way to do that in thwe short term is by increasing marginal tax rates), we are going to be screwed, blued, and tatooed in the global bond market.

I agree with that point. I’m simply saying that it is not in China’s interest to cause much trouble and that they have more to lose than the US.

I also agree that the current debt situation is not healthy for the US economy (nor is the trade imbalance), however, increased taxation is not the only solution. Less governmental spending is a better solution.

Also, increase taxation leads to a contracting tax base and less revenue for the government not more. I think this is well documented. We need to correct the debt escalation and the trade imbalance, and also cut governmental spending and tax rates. This will lead to an improved economy.

Oh, and we need to produce our own fossil fuels and use our coal and gas while we deploy nuclear and work on making alternatives economical.

The US would enter a new age of prosperity with these solutions. Increased taxation and increased energy costs will do the opposite.