As you've probably heard, former Economics Minister Rodrigo Rato, Jose Maria Aznar's man for the last eight years, is the new head of the IMF. He ought to be pretty good. Seems like what he wants, right off, is for the Americans to reduce their budget deficit (I completely agree, with the exception that we're going to have to spend what it's going to cost to fight the War against Terrorism) and for us to reduce our commercial deficit.

Now, my impression is that the American commercial deficit is actually beneficial to America on the grounds of comparative advantage. We export high-priced, high-value-added goods and services, and import low-priced, low value-added products and services, as a general rule. Also, our internal market is so huge that there's enough demand in it for our own high-priced-and-value-added goods and services to make up for the deficit produced by importing less than we export, if that makes sense.

This is why we have a major commercial deficit with China. We import all kinds of low-priced manufactured goods from there, but there's not really much we can sell them. Our stuff is higher-priced than most of their needs, which they meet either internally or through imports from other low-price countries. This is not a problem. We sell our higher-priced goods to countries which can afford them, or in our own enormous domestic market. Note that I know no more about Econ than your average Joe, so if you have any corrections to my theorizing, please contribute them.

(MAJOR EXCEPTION: Education. The Chinese government is not dumb. There are flocks of PRC students at all the less-expensive American public universities. They are more than willing to pay what it costs for adequate-quality education, which is what you get at, say, Emporia State. They've decided that fifteen thousand bucks or so a year, with which they can send someone to Emporia or Fort Hays or Washburn and pay for his keep at a frugal level, is well worth the money if your guy is in the sciences or engineering.)

Rato's policy is going to be tough on Argentina--he's going to make them negotiate with their creditors without giving them any help--, tough on Brazil--Lula wants to count "infrastructure spending" off-budget, which Rato isn't going to swallow--, and nice to Mexico, which has met all IMF criteria.

Here's a good one. Spain's government has all but broken off relations with the United States, right? I mean, unilaterally pulling out of the Coalition is a pretty serious step to take. Well, they want the loan of an AWACS to patrol the skies during Prince Felipe's wedding. One would think Spain's government wouldn't be asking for any favors. What I would do is provide the airplane so just in case the whole collection of royal personages present gets blown up they can't blame it on us. I would also pointedly remind all representatives of the Spanish government that this AWACS plane is being provided thanks to the American "military-industrial complex" and the enormous investment the United States has made in defense technology, without which it would never have been produced, much less even thought of. I'm assuming we're going to charge them rent, that is, the costs of keeping said plane on duty for 24 hours. Greece wants one for the Olympics, too, and I vote we charge them, say, four or five times what it costs to run the thing, at least. Portugal wants one for the soccer Eurocup; I vote we provide one for free. And if the French want one for the Tour de France...forget it. (Morbid note: I would not like to be Lance Armstrong. There's no way they can adequately police those crowds, and he's a notorious and much-disliked American in France.)

The press is making some hubbub over the supposed American reluctance to send the Olympic team to Athens, though the Olympic Committee has already publicly squashed those rumors. The only sports team I know to have bailed out of a game alleging fear of terrorism was precisely the Pamesa Valencia basketball team, which refused to travel to Israel to play Maccabi Tel Aviv and forfeited the game. There were rumors that Pamesa was trying to get Maccabi off its home court and force them to play someplace neutral, thereby getting Maccabi's loud, obnoxious crowd out of the game.

More sports: Well, the Champions League final is going to be Oporto vs. Monaco, neither of which was a favorite to even make the semifinals; everyone was talking about Real Madrid and Milan and Arsenal and the like. Oporto knocked out Deportivo de la Coruna in a game in which most of Spain was behind Depor, and Monaco, starring Fernando Morientes, the Real Madrid cast-off, kayoed Chelsea, the best club dodgy money can buy.

As for the League, it's Valencia in first, Madrid in second, and Barcelona in third right now; Depor will certainly take at the least fourth place and the last Champions League slot. Madrid is in a slump while both Valencia and Barca are playing well. Athletic Bilbao will be fifth and I believe a couple of teams are still in the hunt for the sixth position and the second UEFA slot. Espanyol is a heavy favorite to drop to second division; Murcia is going down for sure.