Monday, January 21, 2008

We Can't Keep Borrowing Money From The Chinese -- They Can't Afford It.

I get an e-mail from my Congressman, Jim Moran:

The U.S. is sending an astounding $60 million a day of our tax dollars just to pay the interest on our debt that China holds. America has never been so deeply in debt to another country in our nation's history. Our current arrangement with China -- we issue Treasury bonds to cover our deficits, they buy our bonds to earn a return on their national savings -- is the equivalent of every American borrowing $4,000 from China over the last ten years.

It's a precarious position we’ve gotten ourselves into, one that can't go on indefinitely.

And so it won't.

The Chinese are barely getting enough of a return on their investment in U.S. Treasury notes and bonds to cover the decline in the value of the dollar versus their national currency. It’s not inconceivable that they could begin to shift more of their investments into other currencies (i.e. the euro) and away from the dollar, which it is estimated comprises 65-70 percent of their foreign holdings. Even a small shift would have major repercussions for the U.S. economy and global markets.

This debt, if it continues growing at the current rate, will hobble our children and grandchildren’s pursuit of economic opportunity and a better life. I believe every American is willing to make a sacrifice towards making tomorrow better than today.

We just need a leader to ask.

I think he's right; I don't know too many people who look at their children and grandchildren and say, "Hell, let the little fuckers pay tomorrow for my lifestyle today." Why should my G/Son be paying for Bush's immoral war in Iraq for the rest of his life? Why should he be paying for Paris Hilton's tax cuts?


Robert Di-Salvo said...

Wow, I really enjoyed this post. We have been discussing this topic in the office now for weeks. Nice to see that not everyone is asleep in America.

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