China has become a bipartisan target over the last couple weeks on the presidential campaign trail. Both President Obama and Candidate Romney have ratcheted up the rhetoric in vowing to get tough on the Middle Kingdom. But while there’s plenty of good reasons for such a policy, neither the president nor the challenger, have put forth a credible plan to enable the United States to take on China more effectively. That’s because without addressing the national debt, you can’t do anything about China.
A large portion of the United States debt—47 percent, according to recent report—is held by foreign countries, who buy up Treasury securities. The majority of that is held by China, who owns slightly more than ¼ of the U.S. debt. How, pray tell, are you going to demand a country stop from manipulating its currency, trashing wage and environmental standards and implementing a coercive and barbaric population control policy, when you’re that indebted to them. That’s the equivalent of you or I deciding we’re going to get tough on whomever holds the lien to the car or is financing the mortgage. It might sound great, it might make us feel good, but it has no bearing on reality.
Thus, neither candidate’s tough talk with China can be taken seriously, because neither is willing to get at the root cause of why we have to silently on the sidelines in the face of Chinese practices. President Obama took economic advice that suggested the road to recovery was to go in the other direction and increase the debt, thereby pumping more money into the economy. Which is about as logical as suggesting a drinking binge as a cure for a hangover. It might make you feel better for the short-term, but now the sickness is going to be exponentially worse when it inevitably comes. Romney isn’t nearly as extreme, but nor does he show any inclination for tackling the structural problems with Social Security and Medicare that are ultimately driving all this spending. If Obama’s remedy for the hangover is a binge, Romney’s cure is a six-pack. It’s not nearly as bad, but one would hardly call it a healthy lifestyle.
There’s no greater example of bipartisan failure in the United States than in dealing with the national debt. A Republican Congress ignored its principles and piled the debt high leading up to the 2006 elections when it was replaced by a Democratic Congress that cut loose with its own round of spending, mostly notably the “stimulus” that was the first priority of the Obama Administration in 2009.
But all the rising debt does is stimulate our dependence on Chinese ownership of the national debt. If you’re a conservative, how does being unable to take a strong stance against a rising military power with population control in any way fit an agenda that highlights national security and traditional family values? If you’re a liberal, how does being unable to stop currency manipulation and worker exploitation in any way serve the interests of the poor abroad and the working classes at home?
If you’re going to talk tough on China, come up with a reasonable plan to stop U.S. dependence on the Middle Kingdom. And a fair definition of reasonable is one that causes political discomfort to the person proposing it.
Dan Flaherty is the author of Fulcrum, an Irish Catholic novel set in postwar Boston with a traditional Democratic mayoral campaign at its heart, and he is the editor-in-chief of TheSportsNotebook.com.