Should the next US administration worry that high oil prices are pushing America's current account deficit towards 6 per cent of national income, the country's all-time record high? Should it worry that the US is single-handedly eating up more than 70 per cent of the combined current account surpluses of China, Japan, Germany and all the other surplus countries in the world? Should it worry that foreigners might start balking at the sub-par returns they have been averaging in the US market for more than a decade? Will it matter for this foreign borrowing binge whether George W. Bush or John Kerry wins on Tuesday?

Our answer to the first question is a resounding "yes". We first began publishing papers on the risks of a US current account collapse more than four years ago.* Back then it was an important medium-term problem. Today it should be problem number one on the new president's international financial agenda. Sadly, we fear it will not be. The winning candidate will probably find it convenient to hide behind one of the proliferating versions of the revisionist theory that there simply is no problem.