The United States owes foreign nations a lot of money. For example, we owe China $1.157 trillion. That’s a shit ton of money. For visual purposes, imagine that your mortgage is $1,157 a month. The US owes China $1,157,000,000,000. According to The Balance, that’s about 30% of our foreign debt.
The reason foreign countries are so comfortable buying US debt is due to that “full faith and credit” thing that a) insures that we will always pay our obligations, and b) almost got shot to hell during the 2013 government shitstorm shutdown, which saw our credit rating drop for the first time in fucking ever. See, normal countries aren’t really concerned that we pay back the principal. They want that annual interest nut. That feeds into their economy – that’s income in their books.
But the more debt a single country holds, the more leverage they have. For example, China. And the fact that they hold 30% of our foreign debt. China is not a “normal” country when it comes to the reasons for holding US debt. There are many arguments on the interweb about the main reason China holds so much US debt – some folks think it’s simply a way to get that sweet, sweet interest income that a huge economy needs to help fill the gaps that communism creates. Others think that it’s to eventually devalue the US dollar and replace it with the yuan as the global standard. I tend to agree with the second camp, but I am also a paranoid conspiracy theorist, so I like to take it a step further: China owns so much of our debt because it makes them feel like they own us. Think about it: If they get pissed enough at us that they want to destabilize us, or worse yet, ruin us, they can call due our debt. I’m not a government employee, so I don’t know the conditions that go along with our selling of debt, so on paper China and other countries may not be allowed to call in our obligations all at once. But if something unacceptable happened, perhaps they’d be inclined to break the rules.
Maybe the unacceptable is breaking the “one China” rule that’s been in place for almost 40 years. See, for a long time, the US did not see the People’s Republic of China (“China”) as a legitimate government. We preferred to deal with the more moderate island called the Republic of China (“Taiwan”) and leave the big commies alone. Nixon’s 1972 China visit with Chairman Mao softened that stance, and by 1979, we had, diplomatically, “unified” China as a combo plate of Taiwan and the mainland PRC.
Why is this important? Because diplomatic protocol has dictated that US leaders communicate directly with Chinese officials for nearly four decades – effectively ignoring the leaders of Taiwan to appease the egos of the mainland Chinese regime. Over the course of many decades and presidential administrations, this has been an area where great caution has been exercised.
Until this past week, when president-elect Dipshit called the president of Taiwan, who of course was more than happy to speak with him. So what happened? Bowels were loosed all over DC (people shit themselves) as folks scrambled to figure out if we were at the brink of World War III, or if their weekends were just fucked.
This wasn’t some one-tooth Twitter follower telling you how Melanoma’s going to be the hottest First Lady ever, you dumb fuck. This is real.
China’s already sent a warning to the Orange Shitgibbon, who’s not even fucking president yet. Let’s say that again: a guy who’s not even president for another (oh my God) seven weeks has already pissed off a country that holds us by the testicles. This is not good, it’s not normal, and it’s not acceptable.
And it’s only the start.