The U.S. debt crisis continues to send ripples around the world.

Jul 22, 2011 by

Tom Watkins

Tom Watkins – If you were a child of the 60s you might recall your mom imploring you to “Eat your peas, children are starving in China.”

Today, as we watch President Barack Obama and his Republican congressional antagonists do battle about raising the national debt limit, reining in out-of-control spending, closing tax loopholes and increasing taxes on corporations and those making more than $250,000 annually, we can hear the Chinese snickering — and worrying.

What a difference a generation makes.

Today, the Chinese are eating our lunch and they are now America’s banker, holding over $1 trillion of the $14 plus trillion U.S. debt. (China is the single largest foreign holder of U.S. debt.)

Yet, like our military, Social Security, Medicare, and Medicaid recipients, and other “creditors,” China too, worries about getting re-paid by the U.S., if we become a deadbeat nation.

Chinese fortune cookies (an American invention — there is no such thing in China) might read:

* “No, sending us your peas is not an acceptable repayment plan.”

* “America, we want our money back — cash for clunkers

* “No more IOU’s- gold or Yua (Chinese currency) only.”

When you are in hock to the tune of $14 trillion, you not only lose face on the world stage, you must also eat crow.

China’s top general, Chen Bingde, suggested to U.S. Navy Admiral Mike Mullen, chairman of the Joint Chiefs of Staff while in China this week,

” I know the U.S. is still recovering from the financial crisis. Under such circumstances, it is still spending a lot of money on its military and isn’t that placing too much pressure on the taxpayers?”

Chen continued, “If the U.S. could reduce it military spending a bit and

spend more on improving the livelihood of the American people, wouldn’t that be a better scenario?”


America: Listen and Learn!

The fact that China would love to see the U.S. pull back what the Chinese see as the U.S. military “encirclement” in Asia did not go unnoticed by the Pentagon.

Perhaps one saving grace for America is the ole adage: “If you owe the bank thousands, you have a problem; owe the bank millions (more like in excess of $1 trillion), the bank has a problem.”

Collectively, we have a problem. The U.S. and China’s economies are linked like a bowl of noodles. Both have reasons to hope our national leaders fix our debt problems — and soon.

Until and unless we get our national fiscal house in order, we will be eating our own peas and forced to swallow a whole lotta crow.”

As Obama told the Congressional leaders earlier this week, “It is time for us to eat our peas.”

Tom Watkins is a U.S./China business and educational consultant. The former Michigan state superintendent of schools,has been working to build economic, educational and cultural ties between our two countries for nearly a quarter of a century. He can be reached at:

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