Why does the United States, the most powerful country in the world, owe money to China...?

Question

Bonus question: how much do we actually owe them? It doesn't seem very wise to me to owe money to a country who is run by a communist regime.

Answer 1

Govt cut revenues to gain popularity and cut government services and then increased spending on war..

Answer 2

First off, China is not a Communist Regime

Communism and capitalism are opposites. Therefore that is impossible.

Second, they are not totalitarian, or a dictatorship.

Totalitarian:
means all aspects of life are controlled by the state. That is impossible since people can move, immigrate, seek new employment, save money, invest it, open up businesses, get rich, spend it in any way they see fit, in short, pretty much do what Americans take for granted.

Dictatorship:
means an autocratic rule or unlimited power. Again that is impossible since the legislature is voted in by the people and the president is elected by the legislature.

As far as how come we, the most powerful country in the world, owes so much money to China.

The answer is easy, consumerism.

Reason, wages are cheap in China, expensive in the USA, so therefore OUR manufacturers go there to save money.

Basic economics 101

Peace

Jim


.

Answer 3

Mathematically, trade flows are balanced by investment flows. The bigger the trade deficit, the more capital flowing into the U.S. Chinese and other foreign investors prefer to trade their goods for America’s equity and debt. America is seen as the safest, surest investment bet in the world. That’s bad news?
Realistically, trade represents voluntary exchange. Any “imbalance” is voluntary. As with trade between a consumer and a retailer at the local mall, the two consenting parties each benefit from the voluntary trade of goods for currency.
Empirically, record trade deficits have coincided with positive economic news in the U.S.: record levels of employment, low unemployment rates, rising pay, and fast GDP growth. The argument that this is a debt-driven party is far less credible than the argument that imports are as economically valuable as exports.
Pragmatically, much of the trade deficit with China represents re-importation by U.S. firms with factories overseas, such as General Motors, Motorola, and Boeing. Parts leave the U.S. and come back as more valuable assembled products. A 2005 National Bureau of Economic Research study[3] reported that 90 percent of U.S. exports and imports flow through U.S. multi-national companies, with 50 percent flowing within a single firm. The lesson for Congress is that American companies, not just China, will be injured by protectionism.

The real dangers to America are not free trade or China’s currency. That’s not to say there aren’t smart policies that should be taken to curb abuses of fair trade, rather that protectionism and currency haggling aren’t part of the smart mix. The real danger is that Congress will try to fix what is not broken and adopt a mercantilist policy of import limitation. Congress would do well to stick to the reliable keys to growth.

Answer 4

because Mr. Mitt Romney and Bain Capital help China milk the USA

In June 2005, Bain teamed up with Haier Group, China's largest appliance maker, and private equity firm Blackstone Group in an attempt to acquire Maytag for over $1 billion. The bid was dropped a month later.

On September 28, 2007, Bain and the Chinese networking company Huawei Technologies acquired 3Com for $2.2 billion in cash.

A vote for Mitt = A vote for communist China

USA= Chinese dog farm

Answer 5

Well. The US doesn't really owe any money to China.

It is a way of offering the country aid, without them losing face.

China has never given money to the US, and we have never bought anything from them.

Remeber, "Made in China" things are still American owned, we don't pay China for them.

Answer 6

Just to show you!
Proof we have become a paper tiger.
Vietnam defeat was an early sign.

Answer 7

LOL how are they gonna force collection? Like borrowing off of your weakling little brother. ( not that they are weak but they would have a difficult time collecting on something like that if we were intent on being malicious)