Lessons the U.S. Can Learn from China

The day after the announcement of Standard and Poor’s historic low grade, the official news agency Xinhua said, “the U.S. should mind its chronic debt problems,” adding “Uncle Sam’s days seem to be numbered, burdened by debt, and will drown in loans from borrowing abroad.” And it added sharply, “China, the largest creditor of the world’s only superpower, now has every right to ask the U.S. to address its structural debt problems and ensure the safety of Chinese assets in dollars.

In fact, the Chinese came to request that the printing of American money be internationally supervised. The feelings of the Chinese are understandable. The United States avoided bankruptcy by a hair, but the threat of insolvency remains real.

American politicians, with their fights, discredit democracy. Politicians, instead of working together to rid the country of their major problems, are focused on their own short term gains. “The debt crisis has exposed the flaws before the benefits of the democratic system of America,” said China Daily.

“A political system of this kind,” China Daily added, “was seen by some as the most advanced form of government in world history, but it has proved ineffective and powerless in the light of the problems it is facing today.”

The Chinese called for common-sense measures, such as major cuts, “the giant U.S. military spending and social welfare costs are just too bulky,” with the warning that, otherwise, there will be more casualties on the credit rating that will further upset global financial markets.

Hopefully, American politicians will arrive at the same conclusion. It is simply irrational that the U.S. has launched wars in Afghanistan and Iraq at the same time it reduced government revenue by cutting taxes, rather than increasing them. Today, after thousands have been killed in the war and spending hundreds of billions of dollars, the U.S. should get rid of the hole in which it has dug itself. The drastic cuts, to the military budget in particular, are inevitable and can be done with few or no effects on national security. The Chinese rose rapidly in the last three decades, because as a country they were instilled with a sense of national revival after an eclipse of a century and a half. It is time for Americans to also resuscitate their country and locate the revitalization of their economy over political disputes.