"David Hartung" wrote in message
...
Soumay Nonay wrote:
David Hartung wrote:

In other words you advise a policy based upon a fear of being
defeated.

That's why China actually enjoys buying into the massive American
deficit. It can use capitalism to do something more attractive than
defeat us: OWN us.

You make a very good point.

As I recall, China holds a sizable percentage of US debt.

Who do you think would be hurt worse, at least in the short run, if the US
were to stop making any payments on debt held by the Chinese? Right now, I
believe that such a move would come close to destroying China.
Unfortunately, in the long term, it would hurt the USA even worse.

I'm not sure it would hurt China at all. It's most likely a calculated bet
on their part: if we default, and they stop supplying us with cheap consumer
goods, we lose. We have no manufacturing base to replace them, and it would
take a sizable part of our GDP to rebuild them, along with likely a decade
or more, during which we would have to simply do without much of what we now
take for granted in our daily lives. China takes over the place we formerly
held as the world's leading economy.

If we ever pay off all the debt, China still wins, because they will have
all those trillions going directly into their economy.