06/12/08
For the third time in my lifetime, a storm of revulsion against foreign investment in the United States is beginning to gather. Only this time the clouds appear much more ominous.
The first episode, dating to my childhood, came a few years after OPEC flexed its muscles in the 1973 oil embargo. The Saudis and others started using their petrodollars to buy up U.S. assets here and there, generating a fair degree of Arab-bashing at the time. It even served as fodder for the rants of the fictional anchorman Howard Beale in Network — a great movie in its own right, and an excellent moment-in-time capturing the zeitgeist of helplessness in post-Vietnam, post-Watergate America. A few years later, OPEC lost all its pricing power as oil was back to nearly $10 a barrel and the storm passed.
The second episode came in the 80s, when Japanese investors started snapping up U.S. commercial real estate, including Rockefeller Center. Time magazine, still sort of relevant in that pre-Internet era, captured the moment with a quote from freshman Senator Joe Lieberman (one must imagine him saying this in his voice for the full effect): "This year when they turn on the lights of that Christmas tree in Rockefeller Center, we Americans are going to have to come to grips with the reality that this great national celebration is actually occurring on Japanese property." The following year, Japan entered its recession-in-perpetuity and Rockefeller Center was back in U.S. hands by 1995.
This time the "assault" is coming not from Arabs, not from the Japanese… but from everyone. And that's what could make the backlash so ugly. America against the world.
Look at just the last two days: Arabs buying the Chrysler Building (never mind that it was already owned by the German subsidiary of an Atlanta-based fund, making its American provenance rather dubious to begin with), and today Europeans are bidding for Budweiser maker Anheuser-Busch. The outraged flag-waving is underway.
Americans will not want to hear that all this is their own fault, borrowing and spending on both a personal and governmental level to a point where they can't help but be in hock to the rest of the world, while the rest of the world seeks real assets to take the place of its increasingly-worthless dollars.
So not only are we heading for a financial storm and an energy storm, but also very likely a storm of ugly jingoism that will only accentuate and accelerate America's pariah-state status. The phenomena might very well feed on each other. (And depending on when it reaches critical mass, it could even prove a decisive factor in the presidential election.) Soon the rest of the world could be as repulsed by the American people as it is by the U.S. government — as our Founders weep in their graves for the Republic that's been lost.
Update: While not exactly a case of "furriners" buying up "Merkin" assets, this is definitely in the same vein — a growing legend that the dastardly Chinese are drilling for oil off Cuba, despite not a drop of evidence to back it up. Memo to Dick Cheney and everyone else peddling this nonsense: If you stopped sucking up to the Cuba Lobby and recognize that if the embargo hasn't worked by now it never will, your friends at Big Oil might be drilling those reserves right now.
Dave Gonigam
Treading a fine line between contrarian thinking and conspiracy theory, Dave Gonigam explores the nexus of finance, politics, and the media for the Daily Reckoning’s Desidooru Saloon. He joined kindred spirits at Agora Financial in 2007 after a 20-year career as an Emmy award-winning writer, producer, and manager in local TV newsrooms nationwide.
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“as our Founders weep in their graves for the Republic that’s been lost.”
Our founders were protectionists, because they DIDN’T want our economy to be dependent on foreign finance. I am sure they are weaping in their graves for the Republic that’s been lost; and it was you idiot Free Traders that lost it.
“While not exactly a case of “furriners” buying up “Merkin” assets”
That kind of remark just goes to show what elitist clowns people like you are, Dave.
Now I know all the Libertarian goofballs who come to this site are going to throw a pissy fit after reading my comments. Well cool it, boys, and go back to enjoying your kiddy porn and other assorted favorite Libertarian pastimes.
Thomas Miller aside, I think most of your readers are intelligent and thoughtful. Isn’t there an Obama website Miller can hang around on?
I gotta lean toward Thomas Miller’s viewpoint there Dave. It’s not the furriners as such who bother me and many others so much. It’s the failure of the politicians of most all stripes to understand that America is not just an ideal, but is also a land with borders, heritage and an identifiable culture worth preserving. The elites disdain us all, of course. Our forefathers and politicians understood that well until the 1965 con that became the Immigration Act. Just ask yourself this: were Americans who thought like me until 1965 wrong? Is “free trade” something the old fuddy duddies — that is, the folks who truly made this country great — just didn’t get? Are you that much smarter than them?
It is more than obvious that fighting 2 wars, lowering taxes on the rich, and creating money out of debt lent below the rate of inflation is going to have bad results. Not to mention transporting your industrial capacity along with now, even middle class jobs to the third world and places like China and India, creating a monster $800 billion trade deficit along with massive Federal government deficits is going to cause inflation. A government run by the corporations, for the transnational corporations just can’t do the right thing for most of its citizens. WTO, GATT, NAFTA are now old enough for their effects to be recognized. Couple that with no effective regulation of the banksters on Wall Street and we today’s ongoing financial meltdown of the dollar. What is strange is that there is a Presidential election and the candidates aren’t debating solutions.Vote for McCain if you want more of the same policies that shrub has given us. Vote for Obama if you want to have false hope of a change. If Obama actually becomes a successful reformer, the inheritors of the people who killed JFK, RFK, MLK, etc will simply kill one of his children.
It’s ironic that Miller is posting from a computer made in Taiwan while sitting in a chair made from China, and sooner will have to drive back home in a car made by Japan. Yeap, us Free Traders have caused the destruction of the U.S.
What if there was no foreign trade? You probably won’t be using a computer because only the rich could afford one. There could be an internet, but there won’t be many sites because of a limited amount of users. And you would be walking home because your USA-built car is in the shop.
Start to realize that you, Miller, is the exact reason for this massive problem we are in. Basicaly, Americans want their cake and eat it too.
We want cheap products, but no trade with other countries. How is that to happen? We want cheap gas, but we don’t want to drill on home land. We will give Arabs money for oil, but they shouldn’t do any spending of it. We want a 2000sf house on a $20/hr salary. Well that happened and look where we are now.
I’m a realist. We’ve given money to the Arabs in exchange for oil. If they want to buy US land, let them do it. Cheap oil has given us the luxury of travel. If the Europeans want to buy Bud, go ahead. More money in the system makes our dollars cheaper, but created has created more wealth for Americans.
We need to go into a deep recession or even a depression. Then, people in all generations will finally learn that to earn money, you have to work for it.
The computer may be manufactured in Japan, but who designed it? Who wrote the software that’s running it?
Miller:
Maybe YOU are the one that is having a pissy(?) fit. Idiot? Goofball? Kiddy porn? Seriously man…blood pressure.
Scooby
No dogbrain, I’m using a computer built in California, I drive a Jeep made in Michigan. I always favor American-made products, wherever possible.
Until recent decades, we had a largely self-contained economy, and we managed to live quite well without a flood of cheap foreign imports. Americans didn’t lose their work ethic until American companies stopped appreciating their hard work by laying them off in droves, even when the companies were profitable. Americans were a thrifty people who did live within their means, back in the bad ol’ protectionist days.
This argument is dead. We are out of money. They won’t be selling us anything pretty soon.
Optimists buy gold, pessimists buy guns, realists buy socks, cause we don’t make them any more.
@Doc
The software is probably designed and written by an Indian software engineer. Or do you imagine the rest of the world is incapable of having an original thought?
Cheers!
America is circling the drain and protectionist trade policy is only going to make it worse, or do Thomas Miller and Ural think that paying $57 for a cotton T-shirt made in a unionized Amerkin plant is going to improve their standard of living?
Get with it socialists. Put down the bong and break out a copy of Wealth of Nations.
Whoa! What a collection of pure morons we have here!
The Great Depresion of 1930′s was build up on credit bubble of ’20 and the trigger of it was the protectionist meassures took by the f#@%ng legislators of USSA of that time…Soon after Hitler was democraticly elected in Germany, Mussollini was in full power in Rome and Japan had no choice than remove ” The Big Evil” and attack Pearl Harbour ( with a little help from our national hero F.D.Roosvelt)…
Just a reminder; back then the dollar was still worth something and the most majority of US population consisted from fresh immigrants already trained to starve days in a row from the style of living they gladly left behind… Now …You know the situation very well, I don’t waste my time any more…
Please applaud our next Dictator ( democraticly elected ) hurah!…Hurrah!!!…Hurrrrrahhhh!!!!!!!!….
Returning to the original subject, I think it is quite likely that there will be a lot more foreign buying in America over the next several years, because we’ve got a lot of terrific property for sale!
Americans own property all over the world – why worry about others buying here? It’s one of the best things that could happen under the current circumstances – it will help support property values, and bring investment dollars here. Let’s face it – land and buildings are just about the most attractive things we have available to offer the rest of the world.
By the way, this mythic pure republic we are mourning was always an ideal more than a real system – it was under attack from the day the country was founded. After the idealists like Franklin, Adams and Washington were gone, the politicians have had their way ever since.
Why I Hate Liberals AND Conservatives
By John “Birdman” Bryant
I HATE BOTH LIBERALS AND CONSERVATIVES, and for one very simple reason: Both of them want to restrict personal freedom by criminalizing various types of behavior which, for all intents and purposes, harm no one except (possibly) those who engage in them.
IN PARTICULAR, liberals want to take away my guns, my property rights, my home school, my cigarettes, my fast foods, my unapproved cancer cure, my Confederate flag, my white-pride sticker, my eagle feathers, my moment of silence, my gas-guzzler, and my big flush toilet.
FURTHERMORE, they want to keep me from talking about (or making jokes about) certain racial or ethnic subjects, force me to race-mix, force me to treat people as equals whether I think they are or not, force me to mix with people who have weird diseases (and keep me from knowing who they are), keep me from getting a job or promotion so that somebody with a different hue or sex behavior can get it, appropriate my tax money for their charities and social engineering schemes, and force me to send my kids to schools I wouldn’t send a dog to in order to be indoctrinated in beliefs which are totally opposed to my own.
LIKEWISE, conservatives want to take away my dope, my rock’n'roll, my dirty pictures, my birth-control devices, my abortion doctor, my morning-after pills, my union card, my Harry Potter and evil-lution books, my flag-burning kit, my Third-World friends, my illegitimate kids, and my polygamous wives.
FURTHERMORE, they wish to keep me from engaging in certain forms of intimate behavior in the privacy of my own bedroom, force me to put my life at risk — and use my taxes for — various acts of military adventurism and political power-seeking that I do not agree with, and require me to make reverent noises toward various brands of religion that I may or may not happen to believe in.
AND WHAT IS MORE, both liberals AND conservatives want to tax away my bank account, snoop away my privacy, burn my anti-government literature, and terminate my unfiltered Internet connection.
THE BOTTOM LINE IS THIS: The division between liberals and conservatives is just a trap. It’s a trap because when we get mad at one of them for taking away one kind of freedom, then we elect the other, who then proceeds to take away another kind of freedom. It is time we recognize that there is no real difference between liberals and conservatives in the way they behave — they both want to do away with individual freedom so they can rule as they please.
IN CONTRAST to liberals and conservatives, there is one group which supports freedom wholeheartedly — the libertarians. Isn’t it about time we started supporting them?
Macan Bhainbh: thanks for that post; I agree whole-heartedly….
Well, let’s just chant Hare Krishna then, since we’re all gonna die today or tomorrow and stop creating bad Karma via lining up our smaller and weaker brothers and sisters, the animals, which we’re all complicit in due to our uncontrolled palatte; and then we can live happily in this life and the next, free from material rebirth, ie. reincarnation in different bodies, animal, plant, fish or human.
Isn’t it time we stop deluding ourselves that all this horrific karmic retribution isn’t of our own creation, due to our being atheistic demons, and living according to our own mental concoction; and ignoring the age-old Scriptural tenets such as THOU SHALL NOT KILL, COVET, AND ALSO POLLUTE THE EARTH?!
Time for a real wake-up call, ladies and gentlemen!
Well starting with that jiberish from Thomas Miller [the victim] and ending the series with a good reading provided by Macan Bhainbh [obviously sane], it’s comforting to know I’m not alone in my thoughts. Thanks Macan.
Oh, let’s not argue the 2nd-party thing, again, man, like it’s getting old and tiresome and counterproductive to the larger, best national interests. As for those who have so enthused about MacanBhainbh (“obviously saneâ€) and his libertarian rantings, …we have some serious issues.. Rather, we’d like to strip free-thinking from the libertarians so they are not able to pander to the duped their ill-conceived, mindless drivel about the sovereignty of man, inalienable rights, natural rights, states rights (10th amendment, etc.), and other such individually-focused freedoms.
You see, I’m from the Gov’t… and we’re here to help. And, unless Gov’t can grow and become increasingly indispensable in the lives of ordinary serf-citizens on the fed plantation, it may have to diminish to the point where rugged individualism, liberty, and freedom of conscience will once again rear its ugly head and stifle true community. After all, it takes a village of international scope to properly build nations and force disciples to further advance the glorious and benevolent kingdom of man on earth.
So, little ones, enough of this rhetoric about the “sameness” of the two parties and cries for alternatives which can only enlighten the duped to the schemes of bondage we have so cleverly designed and deployed; all, of course, in the national best interests. Our plans must not be thwarted and dissent is not needed. So, hush, sweet children and dance to the music of the social sirens. He who pays the piper calls the tune and the nascent utopia is becoming a virtual symphony of epic proportion. Enough futile opposition; come and dance with us; our tune is euphoric, grand, and collective. The Imperial Ballroom is open to the anointed who understand the grand scheme. Oppose at your peril. Dare to expose the plans for a great society before the final act and risk reaping, again, foolish notions of a republic bent on life, liberty, and the pursuit of happiness and other such prattle so antithetical to grander purposes. Only collectivism has the antidote for greed and rapacious self aggrandizement so, only larger, more pervasive gov’t can remediate the ravages of economic disparity. Ask either of the two major parties and they both offer large federal solutions to every aspect of American life. Grand, eh?
Let’s continue our long march through the institutions till we strangle freedom’s life blood from the founder’s vision. We will call the tune and you will dance the waltz of the dazed, the duped, and the dependent. We will glory in your obeisance while we dole out mercies from the national treasure we have arrogated unto ourselves. Repent of these notions of rugged Americanist ideals of individualism, freedoms, and liberties and surrender to the better principles of Corporate benevolence. Your consent and participation is voluntary, of course… just like the 16th amendment. So, let’s hear no more talk of Ron Paul, Chuck Baldwin, Bob Barr, or their ilk. Let them eat cake and Vote McBama.
I’d like to know if all those Libertarians out there like MacanBhainbh who posted above will really Just Say No to Government Dependency and return their forthcoming economic stimulus checks uncashed back to Uncle Sam…
It is like dealing with crazy people. You want all these benefits masquerading as rights…but you don’t want to pay for them so you vote for people who tell you what you want to hear. Then THOSE people go out and borrow money and THEN you complain when the dollar is devalued because our lendors want to get paid in dollars that are actually worth something.
America is ON SALE because we cannot make the payments on the mortgage, folks. There is no nefarious plot here because there is no need for one as long as Americans are willing to sell off their future in return for a little convenience now.
Only I think the convenience is over, isn’t it?
I am not in favor of anyone suffering, but when the majority simply refuse to acknowledge reality then maybe it is a necessity. I do not own a big screen TV because I applied to cost that Buffet has applied to the cars he could afford. I am driving towards retirement and nothing that does not contribute is a waste.
If Americans do not want to be dependent on foreign capital (a neutral thing…nothing wrong with it) then quit electing officials who sell votes for benefits (a bad thing) and elect people who understand that OUR economy has to PRODUCE(a good thing)…not just stir crap from one side of the toilet to the other until something interesting floats up.
Efficient allocation of capital? God, what a joke. They make nothing, they do nothing, they improve nothing…sorry, but unless it results in improved production capacity in the economy it ain’t helping America.
To the Screwtape poster…if you do not have a blog, I would like to re-post your comments…or do I need permission from this blog?
Even if the answer is NO, it was a damn fine post.
-Tim
to Kapper, who wrote “I’d like to know if all those Libertarians out there like MacanBhainbh who posted above will really Just Say No to Government Dependency and return their forthcoming economic stimulus checks uncashed back to Uncle Sam…”
Uh, no. Because that money *was ours to begin with*
To Tim Singleton – I do not have a blog. Must confess, this blog stuff is new to me and I’m a bit challenged, here. If you’d like to re-post the Screwtape, please feel free. I went to your blog site but didn’t see how to email (if you want the original pdf or Word doc). – Charlie