The Budget's a Sham

[I]t’s not clear whether our political system can deal with the crisis of deficits and debt, or whether it will take our foreign creditors, on whose lending we are totally hooked, to administer the shock we need to get our financial foundation on a sound footing. I suspect the latter. They wouldn’t have to do much, just a few public pronouncements in Beijing that China’s central bank plans to invest excess reserves in a different way than it did in the past. In other words, there would not have to be withdrawals of foreign investments, just no increases to feed our ever-growing needs, to induce widespread panic in the markets and in Washington.

China and other foreign creditors are certainly not enthused about Obama's budget proposals. They have invested heavily in funding our debt and are becoming leery of our intent to repay it.