Let’s face it, whenever you owe anyone anything, there is an element of superiority involved. Whether it’s five bucks, dinner, or a date, borrowing and lending creates positions of inferiority and superiority. Just look at some examples: “I am in debt to you.” “You owe me.” “I’ll pay you back, I promise.” This is what makes me scared about the future of America. America owes so much money to China, that it effectively own America.
Our total national debt load is absurd. It recently hit $15 trillion. Just a reminder, a trillion is a one with twelve zeroes. Of that 15 trillion dollars, China owns over 1.1 trillion dollars. Even in a country with a huge economy like the U.S., that money won’t be paid back anytime soon.
With China owning nearly one 10th of our debt, there are certainly some foreign policy dilemmas created. First of all, the United States has a strong business relationship with Taiwan, a country that China considers to be a renegade province. Every so often the United States and China do a dance in which the U.S. sells weapons to Taiwan, and then China protests. With China owning so much of our debt, what we’ve been selling Taiwan, in recent years, has been of a lesser quality and not as up-to-date than previous material.
Domestically, we are being hurt by China’s ownership of American debt. To be blunt, the reason why China manufactures more goods than the U.S. is because their currency is worth so little. The Chinese government unfairly manipulates its currency, so that production costs are lower and the goods will sell for less. Politicians have protested, and China has ignored them. Those fabled American manufacturing jobs won’t come back until China allows its currency to flow into the world markets, like the rest of the world.
In the U.S., something has to be done to reduce our high debt load. Republicans and Democrats across the nation have been at odds over the solution. Republicans favor spending cuts while Democrats favor increasing taxes on the rich. I am going to take a moderate position and argue for both. On the one hand, our country does need to trip its budget and Americans should accept less handouts from the federal government. On the other hand, rich people shouldn’t get handouts, in the form of ridiculously low tax rates and a multitude of tax exemptions, either.
This is supposed to be where I conclude with an epilogue of hope, and talk about how I have faith that we will become self-reliant and stop begging China to finance our wasteful spending. I don’t know though, and I think you should figure it out with me. Go to the New York Times Interactive website and determine how you would save federal money, so that we save money and China stops owning us.