Wall St crisis gives bin Laden the last laugh

Whenever the wind stops howling over the mountains of Tora Bora, a deep, rich chuckle can presumably be heard echoing down the valleys.

If he is still alive, nobody will be enjoying the present plight of America more than Osama bin Laden. The anarchic carnage in the American financial and political system brings in sight a humiliating withdrawal and defeat in Afghanistan and Iraq. It even raises the possibility of the final collapse of the evil empire which Osama forecast.

The US occupation of Iraq is costing $1bn every three days. The total spent so far is $800bn. This year's Senate appropriation for Iraq is $188bn.

The Congressional Budget Office estimated in 2007 that the combined cost of the wars in Iraq and Afghanistan could total $2.4 trillion over the next decade. But that was before

the federal government took responsibility for $5 trillion of liabilities in Fannie Mae and Freddie Mac and pledged infinite billions to the support of the financial system. How can even America afford such all-fronts expense?

Federal revenues are already declining (driven down by rising unemployment with concomitant drops in taxes). Current account running costs are rocketing and, with its commitments to the collapsing financial system, the real risk is emerging that the US government might default upon its obligations, placing Uncle Sam in the same historical category as those earlier printers of money - Mexico, Poland and Zimbabwe.

In the winter of 1916-17, John Maynard Keynes warned the Cabinet that, if they continued to spend £1m a day out of foreign exchange reserves on the war in France, world power would shift irreversibly across the Atlantic to America. Today, a collapse in the dollar as a reserve currency could result in a similarly irreversible transfer of hegemony to China.

Can't you hear OBL hooting?