War in Iraq is not good for the American economy
Posted 9 weeks 1 day ago byBut $500 billion later, experts worry about the impact on the world's biggest economy, already facing a crippling housing crisis.
"The short-term economic consequences of the war have been manageable and modest. But the long-term consequences will be substantial," said Mark Zandi, chief economist of Moody's Economy.com.
Much of the problem, economists say, is that every month of combat adds more than $10 billion to a U.S. debt that now tops $9 trillion.
"Extra government debt is undoubtedly a bad thing for our economic performance in the long run," said Doug Elmendorf, senior fellow at the Brookings Institution and a former economist for the Federal Reserve Board.
As they say, read the whole thing.
There are folks who say that debt isn't, by itself, a bad thing. And it isn't. But too much debt, over too long a period, is simply unsustainable.
Thoughts
Next year we are to bring
Submitted on March 16th, 2008 by AnonymousNext year we are to bring all the soldiers home
For lack of money, and it is all right.
Places they guarded, or kept orderly,
We want the money for ourselves at home
Instead of working. And this is all right.
It's hard to say who wanted it to happen,
But now it's been decided nobody minds.
The places are a long way off, not here,
Which is all right, and from what we hear
The soldiers there only made trouble happen.
Next year we shall be easier in our minds.
Next year we shall be living in a country
That brought its soldiers home for lack of money.
The statues will be standing in the same
Tree-muffled squares, and look nearly the same.
Our children will not know it's a different country.
All we can hope to leave them now is money.
I'm not that smart...
Submitted on March 13th, 2008 by OtherJoelBut somehow I could see the problems here. As you point out, anyone with any semblance of sense regarding finances knows that you need to be careful with debt. It's not that complicated. What goes for your checkbook goes for the country.
Again, I'm no PhD economist, but even I was convinced years ago that the housing market was going to bust. We bought a modest home in 2004, and I remember our realtor and mortgage people telling us how we could qualify for a house 4-5 times the amount of our annual income. When I asked them why I would want to do such a thing, they looked completely baffled. On other occasions, I was scoffed at when I suggested that the housing bubble would eventually burst.
Needless to say, I had serious reservations about buying, suspecting we would get stuck with a house we can't unload. And we very well might. The housing market in Kansas is not nearly as bad as it is in many parts of the country. Yes, we saw escalating values, but it was still relatively modest. And in my zip code, houses are still slowly appreciating. But if I were to sell now, I would not only have to worry about the value; lenders are going too far in the other direction and tightening up borrowing.
You don't have to be a genius to know that whenever there is a boom, there is a correction, and generally the greater the boom, the more severe the bust.
Add to that we are faced with a war that will potentially cost us $3-5 trillion? For what? Part of me has been guilty of thinking that since we're in it now, we have a responsibility to see it through, but I honestly don't think we can fix it anymore. I'm not an isolationist as a rule, but sometimes you need to cut your losses, or "stop digging" as the article suggests.