China flexed its muscles using U.S. Treasuries
NEW YORK (Reuters) – Confidential diplomatic cables from the U.S. embassies in Beijing and Hong Kong lay bare China's growing influence as America's largest creditor.
As the U.S. Federal Reserve grappled with the aftershocks of financial crisis, the Chinese, like many others, suffered huge losses from their investments in American financial firms -- from Lehman Brothers to the Primary Reserve Fund, the money market fund that broke the buck.
The cables, obtained by WikiLeaks, show that escalating Chinese pressure prompted a procession of soothing visits from the U.S.Treasury Department. In one striking instance, a top Chinese money manager directly asked U.S. Treasury Secretary Tim Geitner for a favor.
In June, 2009, the head of China's powerful sovereign wealth fund met with Geithner and requested that he lean on regulators at the U.S. Federal Reserve to speed up the approval of its $1.2 billion investment in Morgan Stanley, according to the cables, which were provided to Reuters by a third party.
Although the cables do not mention if Geithner took any action, China's deal to buy Morgan Stanley shares was announced the very next day.
The concern in certain influential Washington and Wall Street circles is that Beijing would leverage its position as the main enabler of U.S. overspending. And the cables provide a glimpse into how much politics inform relations between the world's two largest economies.
One cable cites Chinese money managers expressing concern that US arms sales to Taiwan -- a major, longstanding irritant in the relationship -- could sour the Chinese public on Treasury purchases...
During the financial turmoil, the cables show that Beijing also shifted its portfolio away from longer-term Treasury notes, which helped drive up America's long-term borrowing costs .
Imo, this is a great reason to cut the budgets/spending NOW, not freezes at elevated levels and gradual reductions over 10+ years. While China is not holding the economic gun to our heads yet , we have to realize it's in the pocket. But yet Obama wants to raise the debt ceiling and invest/spend even more. Our interests are being held hostage to central banks and foreign governments, what the Founders warned us about.
And before the cries of "well Bush (or whoever) started it..", or the rationalization of "Mutually Assured (Economic) Destruction" comes
out, this is the here & now, THIS President is trying to tie the concrete blocks around our ankles and sink us deeper. China can do this and we've got a lot more to lose than they do.
PBO swore/affirmed to "and will to the best of my Ability, preserve, protect and defend the Constitution of the United States."
I don't think he's doing any of these.
The term "high crimes and misdemeanors" had a special meaning to the Framers, and the key to understanding it, is the word "high". It does not mean "more serious". It refers to those punishable offenses that only apply to high persons, that is, to public officials, those who, because of their official status, are under special obligations that ordinary persons are not under, and which could not be meaningfully applied or justly punished if committed by ordinary persons.
Perjury is usually defined these days as "lying under oath". But the original meaning was "violation of one's oath (or affirmation)".
When a person takes an oath (or affirmation) before giving testimony, he is assuming the role of an official, that of "witness under oath", for the duration of his testimony. That official position entails a special obligation to tell the truth, the whole truth, and nothing but the truth, and in that capacity, one is punishable in a way he would not be as an ordinary person not under oath. Therefore, perjury is a high crime.
An official such as the president does not need to take a special oath to become subject to the penalties of perjury. He took an oath, by Art. II Sec. 1 Cl. 8. While he holds that office, he is always under oath, and lying at any time or violation of the oath of office should constitute perjury if it is not justified for national security.
So does this subordination of our national interest(s) to a foreign power constitute a violation of his oath in your view?