Repudiation

I haven't posted all week because I'm sick and tired of being sick and tired... and ... I'm sure you are sick and tired of reading about it. As we have done nothing but lay low, cough, snort, sneeze and wheeze there has been little of interest to write about. So instead here's something totally unconnected with anything.

When I started this blog I decided to keep politics out of it and stay focused on The Trip and family matters. So far (although it's been hard as there's soooo much fodder) I've pretty much stayed with the plan. However the Presidents recent trip to China and it's apparent lack  success has caused me to wonder about the level of knowledge this administration has concerning Chinese history. From what we can see on TV and in the papers the president went to China with his hat in hand ... and the hat was full of IOU's he wants them to buy. At minimum he wanted to make certain they don't start cashing in the trillion or so they currently hold.

The White House staff seemed perplexed that the Chinese would be concerned about the safety of their investment in our debt. Makes one wonder how much they know or understand about Chinese history. The Chinese government is communist. They are the son's of Mao and the Long March their defining historical event. In 1949 they chased Chiang Kai-shek and the Nationalist off to Taiwan and took over the rest of China. The first thing (or one of the first things) they did after killing and imprisoning the bourgeoisie was to REPUDIATE all of the country's DEBT! Yup they reneged on all of the bonds, bank debt and IOU's.

Those repudiated debt instruments are now traded as works of art. I have two bonds issued to finance railroads in China along with their coupons hanging on my wall at home. I will make more money when I sell them than the original holders of the debt.

The sons of Mao are the victims of their own history. They, unlike Americans, believe it is entirely possible that a country would, or may, repudiate it's debt and why wouldn't they... it's in their cultural/political DNA .. in their view it was a successful strategy.

Their historically based paranoia may be the solution to our debt relationship with them. We have a diametrically opposed views of the importance of a country keeping it's word. As Americans we have a deep seated belief in the importance of honoring our currency and debt. The commies do not have that view. They believe in expediency... whatever works. In the center of their soulless existence they believe in power no matter what the source. Just as we find this attitude difficult to understand they find it impossible to believe how we feel.

The point of this bit of pedantry is that Obama as a socialist is more threatening to the Chinese than Bush or any other president. If he would look them in the eye ... Mano a Mano... (hmmm dare I say, commie to commie) and say if you stop investing in our debt or start unloading it we may have to take a page from your 1949 playbook it might scare the caca out of them. They would never expect any other president to back this threat but Obama has already demonstrated his willingness to ignore the the founding documents upon which this country was founded so they have no reason to suspect that he would shy away from something as simple refusing to pay the country's bills.

Of course it's a fantasy but it is fun to think about the president actually defending the country instead of apologizing for it.