Tuesday, February 24, 2009

Going Hat in Hand to the Commies

In a dangerous world in which the United States is engaged in two foreign wars, the Obama Administration is sending a strong signal as to where its true focus will lie. In her first diplomatic venture as Secretary of State, Hillary was dispatched to Beijing to plead with the Chicoms to continue buying American treasury bonds, i.e., continue funding American deficit spending.

Many Americans ignore budget deficits. This is not surprising since the U.S. has balanced its budget only about 3 times over the past 60 years. We have budget deficits because the federal government spends more money than it takes in via tax revenue. Those deficits must be made up each year by either borrowing or printing money. Printing money devalues a currency and brings inflation so the federal government borrows money by selling treasury bonds to whomever will buy them.

Communist China is the biggest holder of United States debt. China currently holds $696 billion of U.S. debt in the form of treasury bonds. The Obama Administration needs for them to buy much, much more. According to the London Telegraph:

The Treasury says it needs to raise almost $500bn (£350bn) in debt in the first quarter alone. Estimates for 2009 reach as high as $2 trillion, a huge sum in a world starved of capital at a time almost all the major governments are launching fiscal rescue packages.

This need for cash has almost totally silenced any criticism on the part of the Obama Administration of China's human rights policies as pointed out here by the Times of London.

[Note: It is extremely sad that one has to turn to foreign newspapers to find any substantive criticism of the Administration of Barack Hussein Obama but I digress.]

The Telegraph also noted that Hillary Clinton's actions are completely contradictory to her statements while running for President.

Mrs Clinton's plea for Beijing to keep buying US bonds comes in sharp contrast to comments during the presidential primaries when she said Chinese ownership of US government debt had become a threat to national security.

Secretary Clinton tried to persuade the potential Chinese investors that the continued prosperity of both parties depended upon China's willingness to continue funding American debt.

"We are truly going to rise and fall together. Our economies are so intertwined, the Chinese know that to start exporting again to their biggest market the United States has to take some very drastic measures with this stimulus package, which means we have to incur more debt."

To be fair, deficit spending did not begin with Barack Obama. Republican as well as Democrat Administrations have engaged in it. However, it is unprecedented for the chief diplomat of the United States to be sent to a former enemy to beg for money in such a public, and embarrassing, manner.

Maybe this is what Barack Obama meant when he said, "Change is coming to America."

--Submitted by B. Bryant

1 comment:

Showmethesale said...

Lots of food for thought in your well expressed post. I certainly hope that this is NOT the change that Obama was referring to when he kept campaigning on a 'change for America'.