The United States pays interest on approximately $850 billion in debt held by the People’s Republic of China. China, however, is currently in default on its sovereign debt held by American bondholders.
Given that the source of this opinion piece is The Heritage Foundation I’m skeptical.
Who are they?
They are a very influential, very conservative American think tank. They advocate for things like anti-communism, neoconservativism, the Christian right, smaller government, bigger military, traditional family values, the wars in Afghanistan and Iraq, white supremecist ideas, voting restrictions - generally all the most destructive policies of the last 50 years.
What is wrong with traditional family values and anti communism?
Because “family values” in US discourse is usually code for homophobia and sexism, while “anti-communism” is usually just racism, classism and xenophobia.
Yeah saying “usually” and assuming a US discourse while not explaining what is wrong with a traditional family value and anti communism is not what I expected. Should have know that people only think in USA while in their “America bad” mind state. My bad.
Thing is, ironically, the only people whom have treated me and my people with racism, classism and xenophobia are leftists, be from Europe or north America. Weird.
What is your ethnicity if I may ask? Because the anti communism bit does vary per society somewhat, but “traditional family values” are usually a far more constant in discouraging a wide variety of perfectly fine things.
I don’t know what ethnicity I am, but leftists love to call me and my people brown gusano even tho we are not from Cuba
I’ll be honest, I dont think thats what anti-communism is.
I dont think the average American really knows what communism is.
In fact, me just saying this will likely result in many Americans acusing me of being a Communist even though I have said nothing to indicate my position on it, one way or the other.
Such is the power of the word ‘communism’ in the United States.
As far as US politics is concerned it very much is. Going all the way back to framing of immigrants as communists in the early 20th century and using that to punish immigrant labour groups. Or using communism as a reason to destroy another Latin American or Middle Eastern country. Or using communism as a reason to arrest left leaning people in the US in the 1950s for no reason. Or the recent policies hostile to Chinese immigrants that were justified by the American public with anti-communism.
These concepts are perverted into justification for actions that are either entirely irrelevant or only related to these values through a very, very specific lens.
An example is family values being used as a cudgel against acceptance of LGBTQ individuals/communities for quite some time now. Or how “communism” quickly became a synonym for “not explicitly conservative”.
The title is mainly clickbait. The bonds they’re talking about were sold in 1938 by the US backed Republic of China, which at the time was fighting a civil war with the Peoples Republic of China (Maoists). The RoC lost, and retreated to Taiwan. The PRoC then assumed control of the country, and decided that it wasn’t interested in paying the debts of the government it had just vanquished.
However, under international law, when the PRoC took over China, they also assumed responsibility for paying those bond holders. Nobody has gotten them to pay up except the UK when the transfer of Hong Kong was up for consideration.
So basically, this is a 70 year old debt that was taken out against China’s former government, and the current government really has no urgency to address it.
As @mazelado pointed out, this is an opinion piece by the Heritage Foundation, so the motivations in writing it are suspect, especially as it’s specifically pushing the Biden administration to fight this very old fight. You would have thought that if had really been a pressing matter, Trump would have handled it when he started the US / China tradewar right before COVID, as it was clear Don didn’t have any qualms pushing potentially destructive diplomatic policies that were unpopular to the Chinese.
You would have thought that if had really been a pressing matter, Trump would have handled it when he started the US / China tradewar right before COVID, as it was clear Don didn’t have any qualms pushing potentially destructive diplomatic policies that were unpopular to the Chinese.
This is a fantastic point. The article sounded correct when I read it, but it felt very obviously biased as well. Your comment here helps me square everything.
The Republic of China still exists, we just know it as Taiwan. Key bit to be leaving out here, especially considering our history with the two and their weird relationship with each other.
This is also a really good point. Britain immediately recognized the PRC after the 1949 revolution while the US recognized the ROC for another 30 years. If the ROC never paid back it’s debts, and the United States never asked them to, the debt was de facto forgiven.
This helps put things in a historical context, thank you!
What a dumb article. Britain was broke in the 80s and needed the money and pressed the issue. China was weak at the time and wanted Hong Kong back peacefully. Under those circumstances it made since to pay the debt. Today China has the second largest economy in the world and zero incentive to pay back America, and no one expects them too.
There is no such magic thing as calling in a debt. If China is in default and no one cares, the debt practically does not exist. Americans complaining about it won’t affect China’s interest rates or anything else.
If China is in default and no one cares
And if China is in default and people start to care?
You’re making a circular argument. Never mind this because nobody cares so we should all not care.
No if you have Biden there… Helping them out all the way
if you owe your bank manager a modest debt you are in his power; if you owe a huge debt, he is in yours.
I bet china will change addresses without updating their forms.
They kind of did. They moved to Taiwan. But the loan was against the house, so…
Ah, reminds me of that quote I saw in Civ VI: If you owe the bank a hundred dollars, that’s your problem. If you owe the bank 100 million dollars, it’s the bank’s problem.
Not in any way, shape or form connected to the current microelectronics and raw material fight between the two countries, right? Right?
Probably more related to the fact that China’s economy is in the gutter and they can’t.
The Heritage Foundation is an iffy source of information on China.
They have a real hate-boner for anything communist.
The republic of china and the people’s republic of china are two different entities. If they want the bonds from the republic of china they should go ask the republic of china (taiwan).
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