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Wednesday, June 24, 2015

Thomas Friedman, "Cold War Without the Fun": The World Stands in Awe of America's Big Wallet?

In his latest New York Times op-ed entitled "Cold War Without the Fun," Thomas Friedman concludes:

"In short, the attraction of the U.S. economy and the bite of U.S. sanctions are more vital than ever in managing the post-post-Cold War game of nations, including bringing Iran to nuclear talks. We may be back to traditional geopolitics, but it’s in a much more interdependent world, where our economic clout is still a source of restraint on Moscow and Beijing. Putin doesn’t disguise his military involvement in Ukraine for nothing; he’s afraid of more U.S. banking sanctions. China doesn’t circumscribe its behavior in the South China Sea for nothing; it can’t grow without exporting to America. It’s not just our guns; it’s our butter. It’s why we should be expanding U.S.-shaped free-trade deals with Asia and Europe, and it’s why the most important source of stability in the world today is the health of the U.S. economy. We can walk softly only as long as we carry a big stick — and a big wallet."

Yes, Supreme Leader Khamenei is frightened to death of America's "big wallet," as evidenced by his demands for further concessions from Obama, even as the nuclear deal being contemplated by the US and its P5+1 partners only extends Iran's atomic bomb breakout time from two months to three months.

And as regards that "big wallet," US national debt now stands at an unsustainable $18.3 trillion. My guess is that China, which holds about eight percent of US national debt, is growing more worried about an ultimate default by the American government and less worried about the sale of goods manufactured by slave labor to American consumers.

1 comment:

  1. TomF confuses the power of the USDollar as the world's reserve currency with 'America's wallet'

    Good thing Wall Street still knows how to roll-over debt to avoid default, having had decades of experience with New York State debt rollovers.

    As for China? I think they are more worried about their own problems (pollution, real estate bubble), which still requires a growth level sustained by exports of manufactured goods.