May 18, 2011
Oh Noes!!! The Chinese are Coming!!!

Another year, another "Someone funny-looking is going to own the whole country!!!" op-ed. The last time I remember this was when the Japanese were buying anything not nailed down in the late 80s, but I think this is a meme that's been around a long time, using Arabs and probably even Brits as the bogeymen in earlier times. Let's look at it a different way.

We are asking foreigners to give us money because we're such great folks. We'll give them a little extra, but only a little, when it's time to pay them back. Remarkably, foreigners are willing to do just that. We then take the money, which is after all simply a notion printed with green ink, and buy actual things from those selfsame foreigners.

The author's second-hand analogy of a rich farmer selling pieces of the farm and increasing the mortgage really doesn't apply. A group of Chinese businessmen can't exactly repossess Warner Brothers or Caterpillar or Trump Towers if we really don't want them to. All they have are deeds, IOUs, and titles. We have their stuff and their cash.

Which is not to say that the national debt is harmless, or a good thing. This is a tropical rainforest economy... it's rich and it's diverse, but it's also maintained in a fragile equilibrium. When we do dumb things like let idiots buy mansions or put Democrats in charge of the government it makes those foreigners less likely to hand us money just because we ask for it. It makes them more likely to ask for a lot more extra when it comes time to pay it back.

The debt is a serious thing, but we're working on it. Putting grownups in charge of the House and then holding their feet to the fire every time they threaten to backslide likely has already done a great deal of good in calming Mr. Chang the Chinese Banker. Once we get back the Senate and the White House next year we'll be able to undo the rest of the damage Pelosi & Co. have caused.

It won't be simple, it won't be quiet, and it won't be easy, but it will be fixed. In the meantime, claiming this situation will have us signing over our children to a Chinese textile plant is simply absurd.

Posted by scott at May 18, 2011 10:09 AM

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And even in the farmer's case, the bank is able to repossess his land because the bank can convince the government to send the cops to kick him off of it.

It's not quite as likely that the Chinese would be able to send their army to occupy Trump Tower.

Posted by: DensityDuck on May 18, 2011 05:34 PM
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