China warns U.S. about its debt

[Turkophagos]

Largest creditor warns about uncertainty

Updated: Friday, 05 Aug 2011, 5:20 PM EDT
Published : Friday, 05 Aug 2011, 5:20 PM EDT

Anaridis Rodriguez

SPRINGFIELD, Mass. (WWLP) - One debt deadline was beaten, but another is looming and the nation’s largest creditor is taking notice.

China’s central bank has called on the U.S. to manage its debt. Just one day after the debt deal, the nation’s top creditor warned Washington of its November deadline, saying more economic uncertainty could hurt the global economy.

“Like any investor they are concerned about having too many eggs in one basket, so they will like to diversify their holdings. The problem is that U.S. debt is still the biggest game in town,” said John Rogers, professor at American International College.

China depends on the U.S. to buy Chinese exports and they are also the largest foreign creditor of treasury debt with some $1.1 trillion. But with the debt ceiling raise, many debate whether the U.S. can resolve its debt obligations with the Chinese nation.

“I don’t think its fair, why should I support China, do they support us?” asked Ann Marie Christopher of West Springfield.

“It doesn’t worry me because I believe the United States find a way or make a way to solve their problem. I know it seems like a lot of money, but they can handle it,” said Elizabeth Ramos of Westfield.

What Congress is trying to handle now is finding a dozen yet-to-be-named lawmakers that will join a committee set to manage the country’s debt for the next decade, and find at least $1.2 trillion in budget cuts by Thanksgiving.

“We hope that that commission is going to start addressing the entitlements, which is where the big numbers are, and that’s a long-term problem, Social Security and Medicaid in particular,” Rogers said.

Congress will have until the end of the year to vote on the committee’s recommendations.

[beaver]

China still remains a part of the system that was built by the US. The tail cannot wave by the dog.