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Hillary To China: Please Keep Financing Our Insanity

by @ 12:39 pm on February 22, 2009. Filed under China, Economics, Foreign Affairs, Hillary Clinton, Politics

Yes, it’s true, the Chinese Communists are now our bankers:

BEIJING (AP) – U.S. Secretary of State Hillary Rodham Clinton wants China to continue investing in the United States because the two countries’ financial futures are closely tied together.

“I certainly do think that the Chinese government and central bank are making a smart decision by continuing to invest in Treasury bonds,” she said during an interview Sunday with the popular talk show “One on One.””It’s a safe investment. The United States has a well-deserved financial reputation.”

To boost the economy, the U.S has to incur more debt, she said, shortly before departing for Washington. “It would not be in China’s interest if we were unable to get our economy moving,” Clinton said. “So by continuing to support American Treasury instruments, the Chinese are recognizing our interconnection. We are truly going to rise or fall together. We are in the same boat and, thankfully, we are rowing in the same direction.

“Our economies are so intertwined, the Chinese know that to start exporting again to their biggest market, namely the United States, the United States has to take some very drastic measures with this stimulus package, which means we have to incur more debt.”

If nothing else, I think this explains Hillary’s eagerness to downplay human rights violations in China.

H/T: Vodkapundit

4 Responses to “Hillary To China: Please Keep Financing Our Insanity”

  1. Ryan says:

    I feel that Hillary is walking a very fine line. If the Chinese stopped investing we could be looking at an *interesting* situation, to say the least. We want to keep them invested while encouraging future investment, plain and simple. Every country we deal with has negative issues in some way, shape, or form. This includes plenty of transgressions which we aren’t aware of.


  2. regretbeingprudent says:

    I would compare Secretary Clinton’s trip to China with someone on the phone with a bill collector pleading for a higher credit limit so that they can pay their debt faster. If China continues to buy our securities, it will not be because they value our relationship or because they care about being in the same boat with us. It will be because they know what our leaders do not seem to know: By continuing the present course, they continue to trade disposable, short-life items (electronics, toys etc.) for our long-term assets (real estate, businesses etc). They know that they are trading their cheap manufactured goods for our future.

    I agree that if China stopped buying our securities now, it would be devastating. I think where most would disagree with me is my belief that it is eventually going to happen. The Chinese people have already seen Japan try to boost it’s economy with more government spending and they have seen what a failure it has been.

    In this country, we have seen trillions of dollars lost in the stock market, we are trillions of dollars in debt with mortgages and credit cards and we have had a trade deficit of nearly a trillion dollars for years now (few things can shrink an economy like a trade deficit). Borrowing another $800 billion and sprinkling it around on projects that do not bring returns like a business investment would is not going to make a dent in our problems.

    Before our lenders completely stop their investments with us, what we will see is the demand for higher returns on their investments to offset the higher risk. We are already spending more on the interest from our federal debt than we spend on education.

  3. tfr says:

    We’re in a kind of Mutual Assured Destruction with China at this point: If they don’t keep lending us money, our currency collapses, and the tens of trillions of US dollars they are holding become worthless.
    I don’t know how long we can keep borrowing our way through this.

  4. kpcrao says:

    China is smart and I strongly believe that in the course of time they will acquire the shares of the major industries. Probably they may start their acquisitions starting from banking, auto and real estate industries.
    Soon major industries are owned by Chinese and their presence in the country would be strongly felt. Employment would be given to more Chinese and in the course of time many and more industries would be owned by them. A mini China in US.

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