How Often Does Your Company Borrow From Its Competitors?

In case you haven't noticed, the American dollar is in the toilet right now.

Most Americans weren't too bothered when the euro rose, unless you were on vacation in Europe. But the Canadian dollar is higher, and for the second time in six months too. The yen exchange rate has dipped below a hundred. Those are two economies much more tightly linked to ours than the EU. When THEIR currencies move relative to ours, we're in bigger trouble. Am I the only one who feels my national pride is bruised? It seems that Canadian tourists can't wait to tell us that the Loonie is ahead of the greenback, and there's not much you can say in return.

The dollar's devaluation really has three causes - oil dependence, the subprime bubble, and our MASSIVE debt. That third one of course is the most troublesome to conservatives, and it was the most foreseeable. And embarrassingly, it has mushroomed on a GOP President's watch.

Ready for the painful truth? We've gone from a public debt of $5.67 trillion at the end of Clinton's last year in office to $9.01 billion at the end of 2007 (those numbers are straight from the U.S. Treasury). If Bush is a conservative, then Clinton was a better conservative. Tough pill to swallow, right? Add to that a trade surplus that goes up one billion dollars every day, and a war that costs (conservatively) 270 million per day, and things aren't looking so great. The painful truth is: if you spend more than you take in, you go into debt. It's true for your family, and it's true for your government.

What's most worrisome is that China holds at least a trillion of that foreign debt. Imagine if Coke announced it was taking out a massive loan from Pepsi! To put it mildly, this puts the U.S. in a frightening position. As a result, government officials in Red China have more power over your currency than do most CEOs of Fortune 500 Companies. If that's not an argument to get the debt under control, I don't know what is. Come on conservatives. We're asleep at the wheel if we let this continue.