The nation’s #1 bond salesman Tim Geithner is jumping on a plane this weekend to China.
What’s he gonna tell them? Well, presumably he’ll reiterate that US debt is a great investment. But (and this is seemingly contradictory) he’s going to urge the government to transform the nation from one based on exporting cheap goods to the United States to one based on consuming more domestically, according to WSJ.
In other words: Stop flooding us with all this cheap stuff that we can’t resist.
Geithner won’t be the first Treasury secretary to have brought this message. Hank Paulson did the same thing, and if we recalled, he urged the country to discover the magic of credit cards. After looking at our situation, they’d be wise to say ‘no thanks’.
Still, we wonder, along with Lucas Engelhardt at Mises.org, where will China get the money to fund our gigantic public debt if they stop becoming a nation of savers and exporters — though that too seems roundbaout. If their loans to the US are based on exports to us, well then presumably we could fund them ourselves. Gah! The whole thing is meant to boggle the mind.