#768 Overdrawn

I’m worried about the Dragon. China’s on the road to being the number one super power. Part of it has to do with the Walmartification of the US economy.
It’s hard to buy a manufactured product that’s not made in China, from lead fishing sinkers to lead toys. The Chinese have their hands in everything from instant soup to nuts and bolts.
In just one quarter of last year, their trade revenues grew by $154 billion.
Naturally, since they have some cash to spend, they are doing what every capitalistic super-economy likes to do, buying up other country’s economies. In the form of their national debt.
When our government borrows money it can’t just borrow it from itself. It borrows it from others. Unfortunately, the current administration’s policy of simultaneously waging a war and lowering taxes—previous administrations have raised taxes during a war—has left a huge budget shortfall.
Shortfall. Sounds like slightly more than a misstep doesn’t it? Not much of a fall at all. In this case, the shortfall is more like a fall off a cliff. The war that was promised to cost $60 billion total, is currently costing $12 billion a month.
It reminds of what historians say brought down the old USSR. An extended war in a Middle Eastern country.
So who is buying our debt? Which country is making it possible for us to overdraw our account and charge our national credit card to the max?
Can you say dragon?
Yep. About 40 percent of the current war debt is financed by China. And I find that just a little bit spooky. Recent domestic changes in bankruptcy law and mortgage implosions indicate creditors can get fire-breathing mean with debtors.
What if China forecloses?
There’s one twisted shaft of hope. It’s all a circle. As in debt as it is, the US government really can’t afford to send out those tax rebate economic stimulus checks.
But most of them will probably stimulate one business, Walmart. So all that money’s going back to China anyhow.
Maybe that’ll keep the dragon dozing for a while.
America, ya gotta love it.