12 Apr. 2010
U.S. Foreign Debt and China
The United States has become a debtor nation. This is plainly seen in its continued budget deficit, which is currently at $2.2 trillion (United 2), and the fact that foreign investors now hold $14 trillion in U.S. assets . Currently, the U.S. absorbs almost seventy percent of all available net savings available on the foreign market (United 60). The macroeconomics of today's globalized economy, encourage nations to incur debt for the purposes of developing infrastructure, both economic and industrial . This is supposed to be for the purpose of stimulating and facilitating the production of goods and services for the nation, providing monetary returns to repay the debt (Glasberg 1-3). The most recent creditor to supply the U.S. its largest single loan of $755 billion dollars, is China, a rising competitor of the U.S. (United 65). This act has created an opportunity for China to directly or indirectly influence U.S. foreign policy. These facts show that our economy is vulnerable to foreign influence and our national security is at risk.
Increased foreign investment by China means they will have greater investment in U.S. businesses. Allowing China to invest in U.S. businesses allows them greater access to our technologies associated with those businesses. Some of these technologies are considered dual use, meaning they have a military as well as civilian application. While these technologies may not be available for direct sale to China, exposure to them may direct the Chinese in their own development, allowing dramatic increases in Chinese military and manufacturing capabilities. While some of these technologies are available elsewhere, most countries with them maintain embargoes against sale to China. Those who don't have yet to equal the level of technological capability of the U.S., so their items are not a threat to U.S. national security (O'Hanlon).
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