and American government is completely grid-locked by politics (thus can’t do much for the domestic economy).
He means can’t do much TO the domestic economy.
We are not defeated exactly, but we do not have a lot of leverage to demand anything of the Chinese. All they have to do is sell the paper they hold all of a sudden and its gonna hurt.
In the past, it was China. Now, it is U.S.. Speaking in financial and economic terms.
Bingo.
In order to fix ourselves, among other things, we need to:
a. Fix a broken regulatory and legal system
b. Establish a policy of sound money so that real investments will return more than flimflammery paper chase scams.
c. Stop bailouts of the big boys spending even more rotten money to bail out rotten loans.
d. Pare back government to providing services for the common good (real defense and security, not DHS, schools, roads, public health, etc. but not endless sprawling bureaucratic outposts with no real mission).
e. Liquidate 30 years of malinvestment. Return unproductive real estate (malls, florida condo's, sprawling housing developments, NY highrises) to the asset pool for productive us.
But the good 'ol boys who have been profiting from the way things have been for 30 years are the ones with their hands on the levers of power and will do everything they can to resist change. What is happening is unsustainable and therefore collapse seems inevitable. It is very sad. Really. But I don't see how we get there from here without rough times.
Here is an example of how bad it is. I live in an HOA with lots of lawyers and petty government officials. It is a public street, but the powers that be are happy assessing dues to pay for private snow removal (DC actually does a pretty decent job these days, ever since the Feds took the city away from Marion Barry because he shut the city down because his brother's snow plows were all broken). It is not legal, but they think they have the right to spend other people's money, even their friends and neighbors, to asssure their own convenience.
The refreshing this is that a couple of block away here in NW DC, neighbors get together shoveling parties and shovel their own streets. In the old days that is how America used to get things done. In the new days, you get a petty tyrant in charge who has no clue, he takes money from everyone else, and tells someone else who barely has a clue to do the hard labor. Of course it is all collapsing.