Wars and tax cuts for wealthy make US the world’s largest debtor $3trillion

January 27, 2007

Geopolitics of Oil, Money and Militarism: George W. Bush pledged $350 billion in tax cuts for the wealthy over a period of 10 years. The invasions and occupations of Afghanistan and Iraq have cost $250 billion so far. According to a Financial Times report, foreign investors: China, Japan, Taiwan and South Korea own c. 53% of all US Treasury bills.

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Geopolitics of Oil, Money and Militarism
The US is the world’s largest debtor ($3 trillion in 2005) due to tax cuts and wars during the presidency of George W. Bush who pledged $350 billion in tax cuts for the wealthy over a period of 10 years. The invasions and occupations of Afghanistan and Iraq have cost $250 billion so far, with another $6 billion added each month (Dillon 2006:2). According to a Financial Times report, foreign investors such as China, Japan, Taiwan and South Korea own about 53% of all US Treasury bills and over half of these overseas holdings be-long to central banks (Dillon 2006:2 citing Financial Times 2005/08/16).

A timeline of geopolitics of oil, money and militarism

Late 1980s tranquility before the crises of the 1990s.

2005 According to a Financial Times report, foreign investors such as China, Japan, Taiwan and South Korea own about 53% of all US Treasury bills and over half of these overseas holdings be-long to central banks (Dillon 2006:2 citing Financial Times 2005/08/16).

2006 “The US is the world’s largest debtor. Its external debt, measured in terms of its “net international investment position”, approached $3 trillion at the end of 2005. The US debt is comparable in size to the total debt of all developing countries which reached $2.6 trillion at the end of 2004 as measured by the World Bank (Dillon 2006:1).”

2006 “Former US Treasury Secretary Larry Summers warily compares the apparent calm on global financial markets [in February 2006] to the tranquility that preceded the crises of the 1990s. Today, the imbalances that threaten global financial stability are rooted in the USA’s burgeoning debt (Dillon 2006:1).”

Selected bibliography and webliography

Dillon, John. 2006. “Will US debt lead to a financial crisis?Kairos. No. 2 February. KAIROS: Canadian Ecumenical Justice Initiatives unites eleven churches and religious institutions in work for social justice in Canada and around the globe.

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