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To: Hawkmoon who wrote (2772)	12/29/2000 2:31:55 AM
From: Don Lloyd	Respond to of 3536

Ron - ...Final point... if the government politicians are only going to spend the surplus anyway (tough to justify placing additional pressure on an already tight market in US bonds paying down debt), then why not give it back and left people use it as they see fit. The government knows even less about how to make that money grow than the US public. Btw, did you see how Clinton claimed we would be debt free in 2010? What a sleazy bastard!! Why would anyone wish to hold US dollars if they have no safety or liquidity in US government bonds?... If you look closely at the White House propaganda release, the claim is only to eliminate the US debt held by the public, and says nothing about the increasing debt (and increasing unfunded liability) held by the so-called social security trust fund. The claims to reduce the general interest rates paid by home mortgage and auto loan debtors in actuality represents a massive wealth transfer from taxpayers to non-taxpaying future or variable rate existing debtors, even if true. All the talk of a budget surplus misses the point even ignoring social security and medicaid. Every dollar the government receives in taxes or expends on legislated programs is a dollar that damages the economy both coming and going. To even talk about a surplus is like saying that it is OK for the government to break the fingers on your left hand if it balances that by repeating the process on your right hand. Even worse, the damage to the economy due to regulation and mandates is a separate matter entirely. The current account trade deficit is also a phantom creation, even if it were measured properly. Every import and every export are both beneficial to both sides of the trade. The idea that exports are good and that imports are bad is absurd. As a fully developed economy, the US benefits from both imports and exports, and if it were limited to just one, would be better off keeping the imports. This is because imports create and support their own distribution system and enforce a competitive discipline on domestic manufacturers, as well as supplying a subset of goods cheaply, allowing more demand to exist for other non-imported products. Exports, on the other hand, often just represent marginal extra demand to US manufacturers and fail to provide really significant broad-based benefits to the economy as a whole. The idea that manufacturing jobs are good jobs that are exported when non-protected imported goods are allowed is a myth based on historical accident. The good jobs lost are primarily union jobs that have forced their employers to the edge of failure due to the government enforced extortion of above market and unsustainable wage rates. Less developed countries, on the other hand, have no choice but to depend on exports, as otherwise there are no means available to even think about purchasing imports. Regards, Don