In his latest propaganda dispatch, Krugman writes:
It’s important to make this point, because I keep seeing articles about the “fiscal cliff” that do, in fact, describe it — often in the headline — as a debt crisis. But it isn’t. The U.S. government is having no trouble borrowing to cover its deficit. In fact, its borrowing costs are near historic lows. And even the confrontation over the debt ceiling that looms a few months from now if we do somehow manage to avoid going over the fiscal cliff isn’t really about debt.
No, what we’re having is a political crisis, born of the fact that one of our two great political parties has reached the end of a 30-year road.
This is such a flagrant distortion that it makes my blood boil.
Basically, the US government is lending money to itself at an artificially low interest rate. This allows professional propagandists like Krugman to claim that the US is having no trouble borrowing money.
The US holds over 6.3 trillion dollars worth of its own debt. By contrast, China holds about 1.1 trillion. (source)
What they’re effectively doing is printing money to buy their own debt. The effect of this is that they steal the saving of everyone in the world who uses dollars. This is going to be a goddamn catastrophe. I recommend guns, gardens and gold.