Dude China and Japan and Sh!tload of others including Russia bought US bonds and they will never be repaid. And they know that.
I agree totally. The 1970's were actually America's last great decade. Personal and gov't debt levels were reasonable. Everybody could afford a house and a decent car. Inflation was a little high temporarily but because debt levels were so low, even if interest rates went up to compensate, the savings rate was high enough to offset it. Then Reagan came in, tripled the national debt, and used that money to create the illusion of good times. People to this day still put Reagan on a pedestal without realizing that all he really did was triple the debt to create the facade of a good economy.
"Speed it up, Speed it up" Banker orders Reagan in public and he replies nervously "oh oh okay" In Moore's movie Capitalism the love story Reagan is clearly shown as a banker puppet. But now that's a given regardless of political party.
Funny you should mention Evil Empire. After we have done away with the commies and reds. We decided that it is our time to make up excuses to attack and provoke other countries. Next target is Iran. Don't you get it, Evil Empire this time is us. And like all evil empires world will get rid of us this time. I guarantee you all rich and poor. By the time 2011 is done. You will know what's it like to have to ration food. I am completely serious when I make this statement. God help us all.
The point you and others is missing is that the dollar is linked to US citizens too. If we don't pay the debt we owe on bonds, the dollar impact due to reduced credit rating would hurt US citizens too. Where, in a standard empire, when you take the other countries gold or other resources, the people of the colony are only impacted negatively while the people of the empire gain.
Last time I checked China is the largest communist country in history and they are doing fine. So, even though the Soviet war in Afghan, which started under Carter by the way, destroyed the Soviet comm. threat the bigger threat of China was left undealt with. So Jimmy Carter, whether it was his intention or not, was responsible for the downfall of the Soviets as the war that crippled them started on his watch.
Are you saying there's no circumstance that the USA will face a game ending scenario? What the guy in the article is pointing out is that all hegemonic nations since the beginning of modern civilization has a tipping point whereby it becomes unsustainable and this tipping point is uncannily common, when the nation is no longer able to service their debt, decline and collapse becomes precipitous.