Chinese media send verbal missiles over U.S. debt crisis
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July 29th, 2011
11:16 AM ET

Chinese media send verbal missiles over U.S. debt crisis

Editor's Note: The following piece comes from Global Post

Chinese media have lambasted the United States for bringing the global economy to the edge of chaos by failing to top up the Treasury's borrowing limit and avoid a catastrophic default.

State-run Xinhua news agency said other countries would suffer because of the wrangling between Democrats and Republicans over a deficit reduction plan with just days to go before the Treasury runs out of funds.

"The ugliest part of the saga is that the well-being of many other countries is also in the impact zone when the donkey and the elephant fight," the commentary published on Xinhua said, according to the Financial Times.

It said the United States was addicted to debt and advised Washington to "revisit the time-tested common sense that one should live within one’s means."

China is the biggest buyer of U.S. debt with holdings at $1.16 trillion in May, and a default would have massive repercussions for the Asian powerhouse.

Beijing has not officially commented on the U.S. imbroglio, but Xinhua's reports are often taken as the official government stance.

The U.S. government's $14.3 trillion borrowing limit is set to run out on Tuesday, meaning the world's biggest economy would be unable to service its debts.

Read: Who owns America?

A vote on a deficit-reduction plan designed by Republican leaders to avoid default was scrapped late Thursday when hard line fiscal conservatives within the party refused to give their consent.

Share markets across Asia were weaker on Friday and there are fears of a sell-off on Wall Street unless the impasse can be broken quickly.

"Headline risk is acute as ever. U.S. debt discussions are going down to the wire, and risk appetite was knocked a little lower," said Sue Trinh of RBC Capital Markets, according to the Wall Street Journal.

But the Financial Times said Western governments had "officially expressed confidence" that the United States would avoid what President Barack Obama has called the "Armageddon" scenario of default.

"We remain confident US authorities will take the necessary decisions to meet its payment obligations," a spokesman for the European Commission said.

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Topics: Debt Crisis • Economy • United States

soundoff (14 Responses)
  1. EastPark72

    If China owns US $1.2T, I’m sure US will act nice and patiently.

    July 29, 2011 at 1:56 pm | Reply
    • j. von hettlingen

      No, on the contrary! I bet the GOP and the Tea baggers want the Chinese and the world to hate Obama. That's why they put up this fight! They want the voters to punish Obama next year!

      July 29, 2011 at 5:38 pm | Reply
      • leeintulsa

        *that's* gonna blow up in their face...

        July 29, 2011 at 7:56 pm |
  2. Mike Smith

    CHINESE HUMAN RIGHTS ABUSE:

    July 29, 2011 at 4:41 pm | Reply
    • Assman

      Nothing here, man, give me a hyperlink or something...

      July 29, 2011 at 4:47 pm | Reply
    • thomas

      mr. mike smith
      thanks for your work which show the world know about society monster evil communist regime it was,

      July 30, 2011 at 9:03 pm | Reply
  3. Mike Smith

    CHINESE HUMAN RIGHTS ABUSE:

    July 29, 2011 at 4:42 pm | Reply
  4. Mike Smith

    brutal CPC engaging in the barbaric practice of organ harvesting done in Chinese labour camps (Gulags)

    ORGAN HARVESTING IN CHINA'S LABOR CAMPS

    Magazine Breaks News on Organ Harvesting in China

    July 29, 2011 at 4:45 pm | Reply
  5. Mike Smith

    CHINESE HUMAN RIGHTS ABUSE:

    July 29, 2011 at 4:46 pm | Reply
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    September 16, 2011 at 2:09 am | Reply

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