China has the ability to quickly destroy the U.S. economy by refusing to buy additional U.S. Government debt. While supporters of the Obama Administration paint this as unlikely, how unlikely is it really?
In an article that ran as CNN.com's lead story last week, Fareed Zakaria--someone who recently suggested updating the Constitution and who apparently has the ear of President Obama--asserted that it's extremely unlikely that China would stop buying U.S. Government debt.
“Here in the U.S. you hear many people worry that the Chinese government might stop buying American T-Bills. I think these fears are vastly overblown.
The economic situation between China and the U.S. is the financial version of mutually assured destruction - that cold war doctrine of nuclear deterrence. If you destroy me, I will destroy you...
So ignore all those theories about China doing America a huge favor. The reality is, they have nowhere else to go. We're probably doing them a favor.” - CNN