Are we under economic attack? The author of a controversial 2009 Pentagon-contracted report, Kevin D. Freeman, seems to think so. Penned for the Department’s Irregular Warfare Support Program (IWSP), “Economic Warfare: Risks and Responses” outlines a “potential direct economic attack on the U.S. Treasury and U.S. dollar” intended to bankrupt the nation and destroy our currency.
The basic threat is a “focused effort to collapse the dollar by dumping Treasury bonds [which] has grave implications including the possibility of a downgrading of U.S. debt forcing rapidly rising interest rates and a collapse of the American economy.” Currently, foreign creditors hold $4.3 trillion of the $14.1 trillion national debt.
The report summarizes, “In short, a bear raid against the U.S. financial system remains possible and may even be likely.” But how would that be possible? How could the U.S. be so vulnerable to an attack against the nation’s key financial and governmental institutions?
The report suggests that government bailouts in 2008 to prop up the financial system has “saddled the U.S. Treasury with substantial debt.” This gives the nation’s creditors not only leverage over the government, but the means to pull the rug out from under it.
Since September 2008, the national debt has risen from $10 trillion to $14.1 trillion, close to 100 percent of the economy now. At exactly the same time of a sharp increase in borrowing, market demand for treasuries has apparently dropped, necessitating the Federal Reserve to intervene to purchase U.S. debt.
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