JD Vance. WE BORROW MONEY FROM CHINESE PEASANTS TO BUY THINGS CHINESE PEASANTS MANUFACTURE. THIS IS NOT A GOOD RECIPE FOR ECONOMIC PROSPERITY.
Also, it’s not true.
Two components. First, why insult an entire country as a whole by calling them peasants? A spokesman for the Chinese foreign ministry said “It is both astonishing and lamentable that this vice president made such ignorant and disrespectful remarks.” A PR genius Vance is not.
Secondly, so how is it that the US is indebted to China? Do Treasury officers go to rice paddies and tap the farmers on the shoulder? How about a few bucks till payday, pal? No. Do treasury officers go to Chinese officials hat in hand looking for a loan? Nope. Maybe we owe for all the merch we buy from China. Are we deadbeats that won’t pay up? No, importers pay cash on the barrelhead before the consumer buys it. OK, so how do we borrow money from China?
SUPPORT AMERICA. BUY US SAVINGS BONDS
I remember the ads in elementary school. My aunt bought me a $25 US savings. But i lost interest when I found out it didn’t mature for 10 years. But many others still hold a keen interest. That is because US bonds are universally trusted. Saudi Arabia has about $800 billion (8/10ths of a trillion) in US investments and about 20% of it consists of US Treasury bonds. However Chinese investment in the US is almost entirely in US Treasury bonds. It is the perfect bank for huge sums. Their purchasing
of US bonds stabilizes the Chinese juan, is the perfect bank for their foreign currency and ensures against loss from bankruptcies or other failing investment instruments. The bonds are low risk, low return. So in return the US Treasury gets a loan with the cheapest possible interest.
The first trump administration did not change the policy of selling bonds to China, nor has the second. And why should they? The first trump administration increased the national debt by 8 trillion dollars. And the second Trump administration is sure as hell going to add more debt. And if we are going to borrow more, why not get the cheapest interest – So his statement of borrowing from Chinese peasants, which we do not – they buy our Treasury bonds, and that it is not a recipe for economic prosperity, makes no sense whatsoever. It is a recipe for the cheapest loans if we have to go further into debt. So why did he say it? Dunno. Most likely he was given a script to follow, which somehow was thought to be receptive to MAGA ears.
The US treasury bonds China holds represents about 2,4% of the US total
debt. By contrast, the part of the US debt owed to the governments own Social Security Administration (internal debt) is 7 trillion, or about 20% of the total 36 trillion of debt. To address JD Vance’s puzzling statement about Chinese peasants – no, we don’t solicit loans from any peasants anywhere. The Chinese treasury buys US bonds w/o solicitation from US.
