Would it make a difference to the U.S economy if foreign debt was paid off?

Question

U.S foreign debt is about 3.7 trillion.

Answer 1

I think the world owes the US more than $3.7 trillion for keeping the world free from Nazis, communists, etc., and for all that cool technology and those awesome movies, etc.

Answer 2

If that debt magically disappeared tomorrow, the Dollar would be more powerful against other currency's and Americans would soon enjoy a more fruitful existence (we may even start traveling. which disgusts me that we don't do more).

A little debt is a good thing, and as Keynes proved, it is a great tool to revive a struggling economy.

The current administration has been using this privilege like a teenager with a credit card. It will take decades to fully understand the damage that is being done. Borrowing from the future places the burden on future generations, while those in power are getting wealthier today.

Answer 3

America is the largest debtor nation in the world and China buys about a billion dollars worth of our debt a day. So lets talk about China.

We need look no further than the website of Senator Charles to find charges that China is unfairly manipulating the yuan for trade advantages and that the Bush administration is responsible for a growing number of manufacturing jobs lost to China.

Currently, China holds the world’s largest accumulation of foreign exchange currencies(what happened?), valued at $941 billion in July 2006, expected to reach $1 trillion by year-end 2006, replacing in February 2006 a top position previously held by Japan.

Whats more is that China is positioning to increase its penetration into the NAFTA marketplace, planning now to operate several Mexican seaports to move an increasing volume of containers with cheap Chinese goods into the U.S. along proposed(illegal) NAFTA super-highways and railroad corridors.
http://www.nascocorridor.com/

The Bush Administration is running the risk that voters will conclude that the U.S. is broke while China is awash in dollars, all for the price of cheap sneakers and electronic games bought at Wal-Mart. How ironic it would be in world history if Red China comes to dominate an emerging North American Union without firing a shot, simply by the force of numbers and the power of harnessing unimpeded a 21st century slave trade? Of course, this would be no accident, as those that study this know.

When the real-estate bubble bursts in the U.S, expect China to pounce- big time.

Answer 4

Considering that paying INTEREST on the foreign debt is one of the biggest expenses the government has, if there were no national debt at all that we could slash taxes by a half or more and have all the same services we have now. So, yes. It would make a VAST difference.

Answer 5

It depends coz you must not forget the other uses of this 3.7trillion if you are using it all to repay foreign debts. Coz this 3.7tn could be used to generate more long term economic growth. But hypothetically speaking, a country without debts of 3.7trillion would definitely have lesser worries.