C. Redmond,
You write:
> What hegemony? The US owed the rest of the planet $1.7 trillion last
year;
> it's probably close to $2 trillion by now. The EU banking system is the
> largest single creditor in the world economy, and is leveraging those EU
> trade surpluses into ever-wider speculations. EU firms are snapping up US
> corporations, insurance firms, banks and bonds like there's no tomorrow
> (Chrysler, Banker's Trust, Transamerica, etc. etc. etc.). A few giant US
> multinationals are doing OK, like Microsoft and Intel, but that's not the
> same thing as the US economy as a whole, which is clearly being starved
of
> investment. Wall Street's ideologues may claim to reign, but only
> Euro/Asiacapital rules. The new metropoles don't *want* the USA to crash;
> they want an orderly accession to Empire. And what they want is what they
> get.
>
> -- Dennis
,and remind me of one of the rich kids I went to school with. I suggested that he was well-off (a suggestion the American rich can never accept) and he retorted that his father owed the banks a million dollars, personally, because of a recent real estate transaction. I then asked him whether he thought that the bank would lend, as personal debt, a million dollars to him, me or 98.92% of the American people. You see, being in debt means that somebody was willing to take your note. Japan pays the "Japan Premium" when they borrow. There is, so far as I know, no "America Premium." Your point rests on the idea that the E.U.. and Japan are generating free cash from industry. Fine, granted, but why is it that they can find nothing better to do with it than lend it to Americans? Why is it that German Bankers whose countrymen suffer from, what, like 10% unemployment? Cannot find any new industries to put Germany back to work? How is it that nearly zero interest rates are not producing an economic boom in Japan?
Again I say there is no such thing as "extra" money. That is a patent absurdity. The Japanese and German capitalists are giving the U.S. financial community their money (and glad to do it) because that money gets circulated far faster here than there. They have nothing good to do with their money while American financiers have all sorts of fun stuff. You seem to think that there is this neo-socialist "real" industrial economy underlying the E.U. and Japan onto which finance capitalism is grafted artificially. Not. It's all capitalism, all the time. Japanese and European capitalists are capitalists. They're not out there to do anyone any favors and indeed they are not doing anyone any favors as the numbers continue to show. They are breaking down the old welfare state and moving industry offshore, including to parts of the now low-wage United States. Do you think that high-wage capitalism is going to outperform low-wage capitalism? Do you think that high-wage capitalism is going to magically transform itself into socialism because of some academic epiphany? The lesson of the E.U. and Japan is not that if you pay a worker a decent wage your society is better. It's not the lesson, not because it isn't true that more money for more people creates a better economy, but because more wages for more people make capitalism more costly and less profitable. Since the only important economic actors in capitalism are capitalists, it really only matters what lesson they, the capitalists, are learning. They are learning the Anglo-American finance capitalism lesson and they are funneling their fat, lazy, industrial dollars into the land of the rentier because it may not be good business, but it's good capitalism.
Show me bond issues from major U.S. issuers that find no foreign takers and I will concede your point. I think you will have trouble since "flight to quality" is synonymous these days with buying U.S. issues.