The US government needs to borrow at least US$1 trillion in the coming year, excluding the US Treasury's $700 billion plan to bail out the financial and other industries, said Kazuo Mizuno, chief economist in Tokyo at Mitsubishi UFJ Securities Co, a unit of Japan's largest publicly traded lender by assets.

That's a lot of money, $1.7 trillion, and all of it by selling treasury bonds on the open market with an historic low interest rate. Ordinarily not even a problem expect that I read a day or two ago a German government bond sale failed to sell the entire offering.

It begs the question what happens with a free spirited Congress, leftist and full of vengeance, which passes every sort of spending bill it can, and then six months down the road-- oopsie -- we only sold 65 percent of the bonds we need to pay for everything just from last year; not even yet counting this year?

What then?

Does anyone really think that Congress will not raise taxes in 2009 if that happens? Because given the tenor of the new Congress, it is not very likely the quickest most efficacious way to resolve this coming crisis -- reduce/cut government spending -- will be implemented?

Cuts in government spending is the one element that most desperately needs to do, if not just to reduce its size and power, but to show that it, too, suffers the same with everyone else; For once such an action may well be a confidence booster.


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