President Bush talks about making Iraq a shining example of democracy in the Middle East. But, at the same time, he and his gang deny the fact that the Kurds, the very same people who helped us temporarily defeat the Taliban in Afghanistan, have already beat Bush to the punch by peacefully setting up their own democracy without any help from us.

Google “Kurdistan” if you want to read about this new nation with its own currency, protected borders, and democratically elected President. Of course, Kurdistan is in the northern sector of Iraq where we recently raided an Iranian office that we claim was a front for terrorism. Kurdistan also has oil that we want.

Meanwhile, back on the home front, Bush has just proposed a 2008 budget of almost $3 trillion while total tax receipts, the government’s only form of revenue, were only $2.4 trillion last year.

Unfortunately, the average American family seems to plan its own budget in much the same manner, planning or forced to spend more than they earn and living on credit by borrowing in one form or another.

How long can we keep this up? What do we do when we run out of equity in our homes and investments? What happens when we have real emergencies that cannot be ignored and our creditors tell us that the line of credit is gone?

In October, 2006, Peter Costello, the head of Australia’s Central Bank (not one of our major creditors) asked Asian nations to “telegraph” their intentions to “come off” the dollar so smaller countries could adjust accordingly.

Within weeks, both China and Japan, two of our really big financial creditors that each hold about a trillion dollars in loans and cash from our trade deficits, announced that they were definitely “coming off” the dollar and investing elsewhere.

After a much publicized December trip to China by both Henry Paulson, our new Secretary of the Treasury, and Ben Bernanke, the new chairman of the Federal Reserve, we’ve heard very little except that China is not “adjusting” their currency the way we would like. The silence on the real problem is deafening.

However, we can look at recent attempts to borrow. Here’s what happened when the U.S. Treasury’s Bureau of Public Debt tried to “auction” (sell) $22 billion in thirty year bonds:

Here’s the recent result for a three year treasury:

And here are results for three and six month bills:

With China and Japan backing away from loaning us money, and Bush asking for even more money to carry on his imperial madness, and all politicians too chicken to raise taxes, Henry Paulson, the Secretary of the Treasury has the options of raising interest rates or increasing the discount price on treasuries as a means of attracting more investment. Such action can also have the negative affect of increasing inflation.

The real question is whether Americans are going to continue throwing their neighbors deeper in debt by purchasing treasuries. The average Americans, the same people who object to the situation in the Middle East, are unwittingly supporting Bush.

If the people really wanted to put a stop to the murder and misery we are spreading around the world, they would demand that their pension houses, 401(k) managers, IRAs and insurance companies stop investing in treasuries that can only be paid back by American taxpayers.

In other words, if you want to stop the war – stop loaning Bush money. He can’t do much without it.