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Got this from www.ConservativeActionAlerts.com
Obama Wants $1 TRILLION Debt Ceiling Hike -- But We Can Get
That From CHINA Right Now... No Debt Limit Increase Needed!
YOU READ THAT RIGHT -- China owes the United States nearly
ONE TRILLION DOLLARS from bonds they sold to US decades ago!
Everyone always goes on about how much WE owe to CHINA --
but they've conveniently forgotten the fact that China owes US so much money!
THAT MEANS WE DO NOT NEED TO RAISE THE DEBT CEILING -- WE
JUST NEED TO WITHHOLD OUR DEBT PAYMENTS TO CHINA!
You probably haven't heard about the fact that China owes
billions to US -- or the fact that they have refused to pay what they owe.
Many decades ago, China sold sovereign bonds worldwide to
investors in many nations. They sold tens of thousands of these bonds on U.S.
soil to American citizens on the recommendation of our government, indicating
it was a solid investment. Over the last sixty years, China has refused to pay
to these bondholders either the principal or interest on these full faith and
credit sovereign bonds.
China argues that because these bonds were issued by a
former administration or regime, the Republic of China, today's China should
not have to honor them. Does this mean that every time the United States
changes presidents, we no longer have to honor the interest and principal
payments to all who purchased U.S. Treasuries during the previous
Administration? Can an incoming president simply refuse to honor any contracts
or treaties approved by his or her predecessor?
OF COURSE NOT. In fact, China's position is in direct
violation of the Successor Government Doctrine of International Law.
Under international law as it has been understood for
centuries, successor governments, no matter the circumstances of the
establishment of a new government, whether by revolution or civil war, must pay
the sovereign debt incurred by its predecessor. But currently, the People's
Republic of China owes a debt of over $750 billion to American citizens who are
holding these full faith and credit sovereign bonds (many of them denominated
in gold) sold to them by the Republic of China. Worldwide, the debt China owes
to all bondholders is estimated to be several trillion dollars.
The debt owed to the American people should be paid. The
U.S. government could dollar for dollar offset bond interest we owe China with
interest, principal and penalties China owes us.
That would be $750 billion. Split 10 to 1, the U.S. taxpayer
saves $700 billion in debt payments and the bond holders could receive the
balance. As part of the deal, each state could receive badly needed investment
funds as well.
That's money that America could use -- INSTEAD OF RAISING
THE DEBT LIMIT AGAIN AND PUTTING US IN MORE DEBT!
It's not like there isn't precedent for China actually
paying back the money they owe from past Chinese government debt. In 1987,
threatened with being kept out of the British financial markets, China
acknowledged the debt it owed from the sale of these exact same bonds to
British investors. As part of the Great Britain-PRC agreement on Hong Kong, the
PRC agreed to pay its debt to British citizens who owned these same bonds. By
paying the British bondholders -- but no other bond owners worldwide, including
U.S. bondholders -- China "selectively defaulted" on these bonds.
Currently, the People's Republic of China owes a debt of
over $750 billion to American citizens who are holding full faith and credit
sovereign bonds sold to them by the Republic of China. Worldwide, the debt
China owes to all bondholders is estimated to be several trillion dollars. As
reported by the American Bondholders Foundation, these facts are not in dispute
by the U.S. Treasury Department, the White House, Congress or the State Department.
In fact, an official at the Treasury commented that, "Yes, the bonds are
real and yes China owes it and should pay it; however, good luck collecting it
as China doesn't really want to pay it".
WHO CARES whether China wants to pay it? WE SHOULD WITHHOLD
OUR PAYMENTS TO THEM if they don't!
Exactly what U.S. or international loophole, guideline, or
precedent does China hide behind to keep from having to pay their debt to these
bondholders? The answer is simple: None! They simply choose not to pay and no
commercial, regulatory or government entity is holding their feet to the fire!
China simply ignores the issue -- and our own government would rather not have
to deal with it and risk "angering the dragon".
Yet China continues to enjoy open and unfettered access to
U.S. capital markets, it has excessive cash reserves and a strong credit rating
which the credit rating agencies (Standard & Poor's, Moody's and Fitch) are
continually upgrading -- even though China's credit rating status SHOULD be "Selective
Default" according to the rating criteria established by the credit rating
agencies!
THIS IS OUTRAGEOUS! Congress needs to FORCE the Government
Accounting Office to add up the total that China owes American citizens -- and
then they need to stop paying money to China instead of increasing our own debt
ceiling!
Look, it's no secret that trade between the United States
and China is severely unbalanced. The PRC holds trillions of U.S. Treasury
notes and bonds. The U.S. trade figures in 2010 showed a $273 billion trade
deficit with the PRC. The difference between what we purchase from them and
what they purchase from us is used by China to purchase more and more of our
U.S. Treasuries. Then, of course, China receives tens of billions of dollars
per year in interest payments from the Treasuries they purchase with profits
from the U.S.-China trade imbalance.
Yet, in July of 2010 and again in November 2010, Dagong
Global Credit, a leading Chinese Credit rating agency, downgraded the sovereign
credit rating of the United States -- even though the U.S. has never defaulted
on its debts. Not only has the U.S. never defaulted, it has never even offered
to pay at a discounted rate.
The U.S. pays its debts in full, and yet China downgraded
our credit rating due to assessed "potential" risk -- while its
leaders announced to the world that the U.S. needs to be "financially
responsible" and "economically sound." The irony is that being
repaid by China is not a "potential risk"; it is today's reality for
thousands of Americans to whom China refuses to pay what is legally and morally
owed!
One U.S. Treasury official, when asked about the U.S.
government's holdings of these bonds, confirmed that they had purchased a
significant portion of the 1938, 1939 and 1940 U.S. dollar-denominated bonds,
and they are still holding them. He affirmed that they did NOT shred them,
destroy them, or in any way get rid of them; in fact, he replied, "Oh God
no; we're saving them for a rainy day!"
These government officials don't seem to realize: it is
pouring rain outside -- in fact, it's flooding!
NOW IS THE TIME to take advantage of the fact that CHINA
OWES US MONEY! NO MORE DEBT HIKES!
As Michael Auslin of the American Enterprise Institute wrote
in the National Review, "Beijing's plan since the early 1980s has been
clear: Get strong. But in its success, China has developed the idea that the
world's rules don't apply to it." And of course, when called to account
for its behavior, it throws what Peter Huessy, President of GeoStrategic
Analysis, calls "geostrategic temper tantrums."
You don't coddle children who throw tantrums; you make them
do what's right. That's what we need to do NOW -- and that's why we've made it
EASY to make your voice heard LOUD AND CLEAR on this issue -- please take
action NOW!
P.S. Ironically -- and hypocritically -- with the fall of
Saddam Hussein's government in Iraq, the PRC insisted at the United Nations
that any successor government in Iraq must be held to pay its debts --
including debts to China. The U.N. approved.
That's what needs to happen here. We need to add up exactly
what China owes America, and refuse to pay them what they say we owe them until
they pay US back. PLEASE, take action RIGHT AWAY to DEMAND that Congress TAKE
ACTION on this issue -- NOW! Thank you!
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