Duh! That's What The Republicans Hope Americans Don't Figure Out

Lots of us have been blogging about the growing problem and debt induced by the big budget spenders of the W, Rove and Co. Finally, the NY time editorial staff has gotten on that old and tired bandwagon:

By definition, federal borrowing eventually results in a transfer of income from American taxpayers, whose taxes go to pay the interest on the debt, to the investors who hold the Treasury bonds. As long as the bonds are owned by Americans, the transfer is simply from one group of citizens to another. Bond holders may get richer, while taxpayers who don't own bonds get poorer, which could add to troubling disparities in personal wealth. But shuffling the income between the two groups doesn't reduce America's overall wealth.

Today, however, 43 percent of the United States' publicly held debt of $4.8 trillion is held abroad, mainly by central banks in Japan, China and Britain and by offshore hedge funds. That's up from a 30 percent share in 2001, an extraordinary increase. Indeed, during the Bush years, 73 percent of new government borrowing has been from abroad.

Paying the interest on the foreign-owned portion of the debt will be a burden on future Americans, draining their wallets and siphoning off the nation's wealth.