The Chinese government is largely financing most of our debt, and now that we're trying to spend our way out of a recession (the right economic policy, by the way), we really need to keep China on our side.
Well, Representative Mark Kirk made that a little more difficult. Here is Representative Mark Kirk in his own words on how he told the Chinese not to believe the United States government!
So, this elected official decided to tell the Chinese government -- our number one creditor and a crucial partner in ensuring that we climb out of this recession -- not to believe the US government. Instead they should believe him, I guess. And if he is successful in convincing the Chinese government not to believe the Obama Administration and the United States government, and they then logically decided not to finance the debt of a government that they didn't believe, then we would really be in a heap of trouble economically.
So thanks Representative Kirk! I hope you are unsuccessful in your efforts to scare the Chinese away from investing in the United States.
1 comment:
This is a problem with running massive deficits. Those who don't want to run deficits have a tool they can use even when they don't win a debate. In the coming years, other central banks and bond operations like PIMCO will have more and more to say on what and how the U.S. government spends money. At a certain debt level, creditors take "implied" equity in an operation. Junk bond king Mike Milken used to say something like this.
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