How does a country like the United States go from a US$200 billion dollar surplus to a US$500 billion dollar deficit in just 4 years? Is it simply bad fiscal management? A few unexpected expenses, caused by 9/11 and the "War on Terrorism" combined with over-zealous tax-cutting for the rich? Or is it something more sinister? I don't usually buy into conspiracy theories, but I first started to wonder about this when George Bush did a tour of Africa a few years ago (right after the invasion of Afghanistan) and promised to spend tens of billions to fight AIDS in Africa. I think it's a worthy cause, don't get me wrong, but this had never been a priority for Republicans before, and with a mounting deficit, I wondered why suddenly now? Was he actually trying to run up a bigger deficit?
Consider this: U.S. Treasury bonds ('T-bonds' as they're commonly called) are the default 'safe' haven for global investors/speculators who are worried about risky stock or currency markets. When things get jittery, they buy up T-bonds. American taxpayers pay the interest, and the American government guarantees them. In effect, it's a way of transferring money from the average American to wealthy American and foreign investors. Of course, this is true of any country which has a debt (ie. 192 of 193 countries in the world). But U. S. debt dwarfs the debt of all other countries- if global investors couldn't buy T-bonds they would lose a source of easy, risk-free profit.
Then I remembered, from an American history course I took in college, that such a pro-debt lobby did in fact exist, in the early 19th Century, when Americans were debating setting up a national bank. Their argument was much the same as the one I've stated above: they thought investors should have a safe place to put their money, with the public paying them interest. Naturally such an idea was not popular, except among the rich.
Ironically, Bush is now using the enormous deficit which he himself created as an excuse to cut social programs for lower income Americans, all in the name of 'balancing the budget' -which he seems to have no intention of doing.
If a pro-debt lobby does exist in the U.S. today, it is obviously one that works behind closed doors, very quietly and informally. If the American public knew about it, there would be quite a scandal. But those who stand to lose from a balanced U. S. budget are the wealthiest (and therefore most powerful) people and institutions in the world. It would be surprising if they stood by and did nothing to try to unbalance the American budget.