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Obama looks to Asia with Europe in decline
“We have a legitimate strategic interest in deterring North Korea and in giving Taiwan some assurance, but I don’t think we have to keep open the sea lanes. I don’t think we have to mediate every dispute, in the South China Sea,” Frank told a foreign-policy forum. “I do not think that China is prepared to commit economic suicide by shutting down the sea lanes.”
Many lawmakers blame China for America’s economic woes. It is one of the few issues on which many Democrats and Republicans agree.
By a wide bipartisan margin, the Senate last month passed a bill to punish China for deliberately undervaluing its currency, a practice that makes Chinese products cheaper in the United States, at a time when the U.S. manufacturing sector is struggling and jobs are scarce.
Lawmakers have also reached across the aisle to condemn Beijing for human rights abuses, intellectual property theft and the counterfeiting of components that end up in U.S. military hardware.
House Speaker John Boehner, R-Ohio, has thus far declined to take up the Senate China currency, agreeing with business interests that it could hurt, not help, the U.S. economy by triggering a trade war.
China has also become a hot political issue on the GOP presidential campaign trail. Former Massachusetts Gov. Mitt Romney has said that, if elected, he would seek to sanction China as a currency manipulator on Day One of his presidency. Rep. Michele Bachmann of Minnesota suggests, without offering evidence, that the U.S. is helping to subsidize China’s People’s Liberation Army with the interest payments it makes to China on the debt.
Only former Utah Gov. Jon Huntsman, who recently was U.S. ambassador to China, warns against actions against China that could result in trade retaliation. He is a former U.S. ambassador to China.
As to borrowing from China to help cover U.S. budget deficits, China buys Treasury bonds the same way as other countries, mutual and pension funds and individual investors do, on the open market.
Last year, the federal government paid about US$206 billion in interest for the portion of the national debt held by the public. China holds about 11 percent of that debt, making it the largest foreign creditor.
“I do think that in this populist age, a little China-bashing never hurts politically,” said Norman Ornstein of the American Enterprise Institute.
Copyright 2011 The Associated Press.
