dollar

== toc =LINKS: Hannah= - Plan is expensive - Spending in sector pisses off people/investors

=UNIQUENESS: Matt= - Dollar is stable. Deficit spending is stable/not increasing

=INTERNALS:=

**Deficit spending collapses dollar hegemony [Recut]**
__**Lewis 11**__ (Katherine, writer for the fiscal times, “National Debt: Budget Turmoil Slams Treasurys”, 5-3-11, http://www.thefiscaltimes.com/Articles/2011/05/03/National-Debt-Budget-Turmoil-Slams-Treasuries.aspx?p=1)

__If global investors start to shun U.S. debt as a safe haven__ — __and the dollar as the world’s reserve currency__ — __the federal government will face difficulty continuing to fund operations__ __with trillions of dollars in debt. Rising interest rates would also cause borrowing costs to skyrocket__ and adversely impact other portions of the federal budget. During the fourth quarter of 2010, U.S. households, the financial sector and foreign investors purchased Treasury securities worth nearly $300 billion less than the average purchases of the previous three quarters, according to an analysis of Federal Reserve data by Société Generale. __China,__ the single biggest Treasury investor with just under 26 percent of U.S. debt, __is //shifting some of its Treasury investment//__ __to commodities and capital investment outside the U.S__. In January, China reduced its portfolio by $5.4 billion to $1.15 trillion, according to data released by the Treasury Department.

**Dollar collapse obliterates U.S. global leadership [Recut]**
http://www.gold-eagle.com/gold_digest_05/taylor012105.html)
 * Taylor 5** (Jay, Editor – Gold & Technology Stocks, Gold Digest, 1-21,

Given my views that we are inevitably headed toward a deflationary cleansing of the excesses of the market, I have always had a sense that at some point the dollar would show surprising strength. But __given the U.S. addiction to foreign capital__, I have come more recently to believe that __avoiding a major collapse of the U.S. dollar__ is a policy that __must be maintained at__ virtually __all costs__. It is a well-documented fact that we Americans have enjoyed a consumption spree beyond belief because of low interest rates made possible by foreigners reinvesting their export earnings in the U.S. What fewer people have focused on, however, is the really big reason why __the U.S. cannot afford to let the dollar fall too far__, even if defending it means a collapse of the U.S. housing and equity market and an evolution into the Kondratieff winter depression. __The survival of an American empire____that can send its military into foreign lands__ to secure sources of oil, secure trade routes, and intimidate foreign leaders into "playing ball" __requires that the dollar remain the world's reserve currency. **Nothing is more important** to the survival of U.S. superpower status than the dollar remaining as the world’s reserve currency.__

=IMPACTS: Ellen N' Saunders= Econ Heg Good/Bad