After 6 years of looting the public till, the cupboard is just about bare. Bush has chalked up another $3 trillion of public debt which sounds the death-knell for Social Security, public education, and the social safety net.

Think I'm kidding? Consider what new Fed-master Ben Bernacke said just yesterday, "If the dollar declined sharply, it would not necessarily disrupt markets".

That's right; the Fed is conspiring to reduce its debt payments by driving a wooden stake into the heart of the greenback. In three to six months the dollar will probably be valued at 1.40 to 1.50 per euro. That is, if the bottom doesn't fall out completely. After all, allies and enemies alike are pretty sick of the good old USA, so it wouldn't be out of the question for someone (perhaps, China) to start a sell-off that would end in disaster.

The dollar is now recognized as the empire's Achilles heel and the primary target for any asymmetrical warfare directed at America. If that means regime change at home, count me in. I'll worry about the wheelbarrow-loads of greenbacks for a loaf of bread some other time.

The Group of Seven industrialized nations (G-7) took a few swipes at Washington's profligate spending this weekend; warning that they wanted "more flexibility" in the Asian currencies. This is a clear sign that the path is being paved for a freefalling dollar while the other currencies gain ground.

How do you like the idea that half of your savings will be erased through executive fiat?

Since Bush took office the dollar has plummeted 30% against the euro. The only thing that has kept it from joining the peso is the skyrocketing oil prices which have allowed the Fed to keep the printing presses going at full tilt. That's because oil is denominated exclusively in dollars, so while the price per barrel continued upward, the Fed was able to circulate another $2.5 trillion of funny money. The high cost of oil has kept the dollar reasonably stable even though the twin-deficits have eroded its true value. Maintaining the monopoly on the sale of oil (which forces foreign central banks to hold billions of greenbacks in reserve) is critical to US prosperity. A switch to euros would weaken demand for the dollar and send the American economy into a tailspin.

Unfortunately, other countries are frustrated with the recklessness of the Bush team and are threatening to destabilize the system. First there was the danger of Iran opening an oil bourse that would compete head-on with the dollar; increasing the number of euros stockpiled in the central banks. Now, the Russian Finance Minister, Alexei Kudrin has fired a broadside at his American counterparts saying, "The US dollar is NOT the world's absolute reserve currency". He noted that the 'unsustainable' US trade deficit is "causing concern" and that "the international community can hardly be satisfied with this instability."

Kudrin's remarks were greeted with the shock one would expect from a dirty bomb on a crowded subway. America's global dominance requires that it maintain the dollar as the world's reserve currency; if that changes then the US will be unable to trade its painted-script for valuable resources. It would also mean that America would have to start paying back its $9 trillion national debt.

Kudrin's comments were interpreted to mean that Russia might ease away from the dollar in its oil transactions; a change that might spread to other countries that are equally skeptical of Uncle Sam's recklessness.

The eroding value of the dollar is just one of the economic crises facing the American people. A 6 month downturn in housing starts signals that the housing bubble, the largest equity bubble in history, is quickly losing steam. With long term interest rates steadily rising (along with energy prices) the shaky loans that were blessed by former Fed-chief, Greenspan, are beginning to unravel. "No down payment", ARMs (Adjustable Rate Mortgages) and easy financing have the over-extended American public teetering towards insolvency. Foreclosures are up, mortgages balances are at unprecedented levels, and inventories are larger than they've been since the early '90s. Last month produced the biggest slowdown in sales in a decade and the real pain hasn't even begun. At least $3 trillion of the $9 trillion equity bubble is built entirely on the cheap money pumped into the system by the Federal Reserve to keep the economy percolating while Bush and Co. stole every last farthing in the US Treasury. Greenspan's low interest rates were nothing more than a carnival-hucksters' scam to shift the vast wealth of America's middle class into the pockets of well-heeled constituents.

Thanks, Alan.

Last year Americans used their homes as a personal ATM; withdrawing over $600 billion to pay off credit card debt and for personal spending. That "presto-equity" is quickly evaporating as home prices flatten out and wages continue to stagnate. Personal debt is currently in the stratosphere and there are some gloomy signs that the American consumer, that great engine of global economic power, is finally tapped out. Consumer spending represents 70% of US GDP (Gross Domestic Product) so, as housing prices retreat and energy prices increase; Americans will face the greatest economic challenge since the Great Depression.

One thing is absolutely certain; Bush will stick by his constituents to the bitter end. It is physically impossible for him to act in the interests of the American people. He won't be deterred by the falling dollar, the deflating housing market, or the skyrocketing energy prices. He'll make his budget-busting tax cuts permanent and plunge the country into a sea of red ink.

Betting that George Bush will do the wrong thing for the nation is not a matter of conjecture; it is a mathematical certainty. He is deliberately destroying the middle class, the prospects for upward mobility, and the currency. The economic underpinnings of American democracy have been demolished in just 6 short years. Smart people will prepare themselves for the typhoon ahead.

Democrats have been hammering away at the $3 trillion in new debt the Republican-controlled Congress and White House have presided over during the past five years. This fiscal year alone, the U.S. budget deficit could exceed $400 billion.

The administration had proposed about $92 billion in emergency funds for combat in Iraq and Afghanistan and to continue rebuilding southern states hit by Hurricane Katrina.

"If the president is ultimately presented a bill that provides more than $92.2 billion, exclusive of funding for the president's plan to address pandemic influenza, he will veto the bill," a White House statement said.

Senate Majority Leader Bill Frist, a Tennessee Republican, applauded Bush and said he "will support a veto, if necessary."

In March, Congress defied a veto threat from Bush and pushed ahead with legislation to stop a Dubai-owned firm from managing some American ports. Dubai Ports World abandoned that plan when the extent of Congress' opposition became clear.

Republicans are deeply divided over spending priorities in an election year.

The Senate could take up to two weeks to debate the $106.5 billion measure that includes $67.6 billion the Pentagon says it urgently needs for the wars in Iraq and Afghanistan. About $27 billion would be added to the cleanup tab for Hurricane Katrina. Various other projects totaled nearly $12 billion.

On Tuesday, the Bush administration asked Congress to approve an additional $2.2 billion in emergency funds to strengthen levees around New Orleans. This would be in addition to almost $1.5 billion previously sought.

But the overall spending in the Senate bill is about $14.5 billion more than Bush requested and what has been approved by the U.S. House of Representatives.

Included in the added funding inserted by senators was aid for farmers who have suffered weather-related disasters, funds for the U.S. fishing industry and money to move a Mississippi railroad critics say would only help developers and casinos.

Calling it the "railroad to nowhere," Sen. Tom Coburn, an Oklahoma Republican, and some House conservatives vowed to delete the $700 million for the CSX railroad line. Before he became Bush's treasury secretary, John Snow was the company's chairman.

Senate Appropriations Committee Chairman Thad Cochran, a Mississippi Republican, defended the railroad project, saying "the future well-being of that entire coast area would be enhanced if the railroad could be relocated."

Hart said Coburn will join efforts to delete $500 million in the bill that would help Northrop Grumman Corp. offset "business disruption expenses" in its Gulf Coast shipyards, saying such losses would likely be covered by insurers and pending litigation.

"We are overweight and overspending," said Rep. Tom Feeney, a Florida Republican, referring to spending bills in recent years that have contributed to huge federal budget deficits.

It is not unusual for members of Congress, especially in an election year, to tack special-interest projects onto "must-do" legislation, such as a war-funding bill.

Bloated spending has undercut Republicans' long-standing claims they are the party of fiscal responsibility.

Rep. Jeff Flake, an Arizona Republican, said one need only look at huge federal expenditures over the past five years "if Republicans want to know why we're in the tank" with voters.

The author of the newsletter The Gloom, Boom & Doom Report said gold wasn't expensive when "you compare its price to the quantity of money that has been printed in the last 10 to 15 years in the US and the world in general".

Gold for immediate delivery rose to $US645.85 an ounce on April 20, its highest in more than 25 years, as hedge funds and other speculators bought commodities to seek greater returns than from stocks and bonds. Former George Soros partner Jim Rogers forecast last week that gold would reach $US1000 an ounce.

The outlook for gold depended on how much money Federal Reserve chairman Ben Bernanke "will print", Mr Faber said in an interview in Tokyo on Monday.

"As you know he has pronounced speeches about asset deflation," Mr Faber said, referring to Dr Bernanke. "He's concerned about real estate and stocks going down, so in the long run for sure he'll print money."

Pension and mutual funds are pumping record amounts of cash into commodities as China's booming economy stokes demand for oil and other raw materials, leading to a three-year boom in prices. The amount of money invested in index-linked commodity funds rose last year by as much as $US30 billion to $US80 billion, according to Barclays Capital. The amount might rise by 38 per cent this year to $US110 billion, the bank said.

Gold for immediate delivery reached a record $US850 in 1980.

Energy and uranium prices would continue to rise on growing Asian demand, Mr Faber said.

"Asian oil demand will double," he said. "We don't know whether that will be in eight or 15 years but for sure it will double and I don't think supplies will be able to match that."

Mr Faber has worked in Asia for more than 30 years. He served as managing director at the Hong Kong unit of Drexel Burnham Lambert from 1978 to 1990.

He did not rule out a big correction in commodity prices.

Still, that would not mean the end of the commodity boom.

"Between December 1974 and August 1976 the price of gold declined from $US195 to $US103," he said. "Then it still went up eight times."

The US is heavily dependent on imports for manufactured goods, including advanced technology products. In 2005 US dependency (in dollar amounts) on imported manufactured goods was twice as large as US dependency on imported oil. In the 21st century the US has experienced a rapid increase in dependency on imports of advanced technology products. A country dependent on foreigners for manufactures and advanced technology products is not a superpower.

Because of jobs offshoring and illegal immigration, US consumers create jobs for foreigners, not for Americans. Bureau of Labor Statistics jobs reports document the loss of manufacturing jobs and the inability of the US economy to create jobs in categories other than domestic "hands on" services. According to a March 2006 report from the Center for Immigration Studies, most of these jobs are going to immigrants: "Between March 2000 and March 2005 only 9 percent of the net increase in jobs for adults (18 to 64) went to natives. This is striking because natives accounted for 61 percent of the net increase in the overall size of the 18 to 64 year old population."

A country that cannot create jobs for its native born population is not a superpower.

In an interview in the April 17 Manufacturing & Technology News, former TCI and Global Crossing CEO Leo Hindery said that the incentives of globalization have disconnected US corporations from US interests. "No economy," Hindery said, "can survive the offshoring of both manufacturing and services concurrently. In fact, no society can even take excessive offshoring of manufacturing alone." According to Hindery, offshoring serves the short-term interests of shareholders and executive pay at the long-term expense of US economic strength.

Hindery notes that in 1981 the Business Roundtable defined its constituency as employees, shareholders, community, customers, and the nation." Today the constituency is quarterly earnings. A country whose business class has no sense of the nation is not a superpower.

By launching a war of aggression on the basis of lies and fabricated "intelligence," the Bush regime violated the Nuremberg standard established by the US and international law. Extensive civilian casualties and infrastructure destruction in Iraq, along with the torture of detainees in concentration camps and an ever-changing excuse for the war have destroyed the soft power and moral leadership that provided the diplomatic foundation for America's superpower status. A country that is no longer respected or trusted and which promises yet more war isolates itself from cooperation from the rest of the world. An isolated country is not a superpower.

A country that fears small, distant countries to such an extent that it utilizes military in place of diplomatic means is not a superpower. The entire world knows that the US is not a superpower when its entire available military force is tied down by a small lightly armed insurgency drawn from a Sunni population of a mere 5 million people.

Neoconservatives think the US is a superpower because of its military weapons and nuclear missiles. However, as the Iraqi resistance has demonstrated, America's superior military firepower is not enough to prevail in fourth generation warfare. The Bush regime has reached this conclusion itself, which is why it increasing speaks of attacking Iran with nuclear weapons.

The US is the only country to have used nuclear weapons against an opponent. If six decades after nuking Japan the US again resorts to the use of nuclear weapons, it will establish itself as a pariah, war criminal state under the control of insane people. Any sympathy that might still exist for the US would immediately disappear, and the world would unite against America.

A country against which the world is united is not a superpower.

Paul Craig Roberts was Assistant Secretary of the Treasury in the Reagan administration. He was Associate Editor of the Wall Street Journal editorial page and Contributing Editor of National Review. He is coauthor of The Tyranny of Good Intentions.He can be reached at: paulcraigroberts@yahoo.com