Yep, it is bad. During the 1920s Germany faced a similar situation...except they were unwilling to send out their currency (the Versailles Treaty forced it on them), and we voluntarily sent out our money:
Source, About.com:
Article 235 calls for Germany to make payment equivalent to twenty billion marks as a down payment of sorts while the Inter-Allied commission decided on an exact amount. At the time of the signing of the treaty on June 28th 1919, with exchange rate of almost 14 marks per dollar, this equated to approximately 1.43 billion dollars. In 1921, the Inter-Allied Commission valued the cost of German reparation payments at thirty-three billion dollars. In January of 1921 the average monthly exchange rate was 64 marks per dollar. This meant Germany owed 2.112 trillion marks. A summary of the exchange rates can be seen in Figure 1 based on Gordon Craig’s book Germany: 1866-1945. Despite the enormity of its debt, German taxes never exceeded 35% of expenditure between 1919 to 1923. In order to cover the difference the German government printed more money. In November of 1918 there were 29.2 billion (29,200,000,000) notes in circulation. Within five years the number of notes in circulation had increased to 497 quintillion or 497 with 18 zeros after it (Economist 92). That’s over seventeen billion times as many notes in just five years!
With the amount of M1 in circulation increased, the quantity of money demanded plummeted. By looking at the graph in attached Figure 2, it is obvious what a drastic effect this had on interest rates. With the interest rate decreased (if not all but eliminated), people’s desire to save fell considerably. Because income is equal to savings plus consumption, when savings fell, consumption increased and the Aggregate Demand curve shifted to the right. Ordinarily this shift of aggregate demand would cause the economy to temporarily produce beyond its long-run aggregate supply causing an expansionary gap. But according to the Dawes Committee Report, which will later be further elaborated on, Germany at this time had been producing well below potential output. The report also contains evidence that the potential output had been increasing as well, meaning a rightward shift in the long-run aggregate supply curve. Without knowing where Germany stood in relation to the actual long-run aggregate supply prior to this time its impossible to know exactly how much of an expansionary or contractionary gap this expansion led to. But according to demand-pull inflation, illustrated in Figure 3, when aggregate demand shifts to the right, the price level increases, as does the quantity supplied in the short run.
Between its low point in 1919, when production was at only 37% of the prewar level, and 1922, when it was up to 71% of prewar production, Germany had increased productive volume by over 90% (Wagenführ qtd. in Kaes 78). In 1922 it took 191 marks to by a single dollar, up from 14 after the signing of the Treaty of Versailles (Figure 1). While the inflation proved fruitful for the entrepreneurial income, it was at the expense of the workers’ wages (Wagenführ qtd. in Kaes 78). This was because while prices were going up, the price of many resources, namely labor, remained fixed, allowing employers to enjoy the extra money. The workers however found it increasingly difficult to buy even the necessities as wages were unable to keep up with inflation (79). Most people were unaware that others were gaining so much by the devaluated currency. “They knew hunger…And in their misery and hopelessness they made the Republic the scapegoat…Such times were heaven-sent for Adolf Hitler†(Shirer 62).
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Is America all about buisness opportunities--including shipping out jobs--all in the name of profit? Or should profit be subject to what is best for the country?
Profit über alles!
...or...
America über alles!
...or...
Is there something even greater than "America", if we consider her to be just a geo-political entity?
_______ über alles!
I'd bet even the Christians do not dare answer that.
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