What Never Stops Growing?

I once had a professor who advised his impressionable students that, when you pick up a newspaper, if you want to read the real news you should turn to the business section. From my experience, again and again he has been proved correct. The first section, the "news" is the just the start. If you read that you'll know what's going on; to understand the context you have to turn to the trusty report on business.

So I did today in a newspaper I had picked up a few weeks ago. I read about corn wars and the little piggies that were on the frontlines of Canadian farmers' prosperity. There was a section on how bilateral trade is replacing its problematic and difficult cousin, multilateral trade. Then, getting more political, was the impending visit of the Chinese President, Hu Jintao to the United States. Yes, this is still the business section. The article explained that, in this congressional election year, China was a target of politicians seeking re-election because of its reluctance to deal with intellectual property rights and its weakly valued currency.

That got me thinking about national debts and deficits. Back in the early 1990s, these issues were the talk of the town. It seems that these days they take a backseat to more pressing concerns like terrorism and "freedom". But of course they are still important. The US' national debt stands at just over $8 trillion and Congress has authorized a ceiling of $9 trillion. The related US trade deficit (exports minus imports: if negative it's a deficit, if positive a surplus) in January 2006 was $68.5 billion. These numbers are mindblowing! Let's not forget that the US spends $400 billion annually on defense either. Canada has a debt of $600 billion by comparison and a misleading surplus given the plight of provinces and cities. According to the CIA, Brunei, Palau, Tokelau, Lietchtenstein and even Palestine are the only countries with no debt. Even Greenland owes somebody $25 million.

I wonder how serious we all are with getting out of debt. Things seem to be going pretty well for some even though we are carrying around all this credit. Yet all that Jean Chretien, Paul Martin and Mike Harris could ever say was that we were drowning in debt so as a result they cut as much as they could and downloaded everything onto the cities. But at the same time they cut taxes which mostly benefited the wealthy. Hmmm, could it be that all this debt-mongering was just a ploy all the time?

Still what would happen if all these debts got called in? Say when creditors need all their assets to buy steadily more expensive oil to keep their economies and businesses going. I bet you'd want to be a debt-free Palestinian then. Wait . . . no you wouldn't.