China: America 'Kicks Can' Towards 'Fiscal Abyss'

Wednesday, 02 Jan 2013 06:26 AM

 

Share:
  Comment  |
   Contact Us  |
  Print  
|  A   A  
  Copy Shortlink

The last-minute U.S. deal over tax increases has fixed one problem, but the world's largest economy must get to grips with a budget deficit that threatens not a fiscal cliff but a "fiscal abyss", China's Xinhua news agency said on Wednesday.

The state news agency said in a commentary, issued in English on its website, that while the United States was clearly the dominant economic power, it "simply cannot live on borrowed prosperity forever," and its politicians seemed reluctant to tackle its total debt of about $16 trillion.

"In a democracy like the United States, tax increases and spending cuts, the exact dose of medicine needed to cure its chronic debt disease, have long proved hugely unpopular among voters," Xinhua said.

"So the politicians have chosen to kick the can down the road again and again. But as we all know, the can will never disappear. Sometime and somewhere, you might trip over it and fall hard on the ground, or in the U.S. case, into an abyss you can never come out of."

China has a strong interest in a healthy U.S. economy. It sits on the world's biggest pile of foreign exchange reserves, worth $3.3 trillion, and as much as 70 percent of the holdings are invested in U.S. dollar assets, including U.S. Treasuries, according to analysts.

The United States also is a major export market for China.

Global stock markets rose on Wednesday on relief that the U.S. had passed measures to avert the huge tax increases and spending cuts that would have pushed the economy into recession.

However, Xinhua also took aim at U.S. politicians, saying that if they came so close to falling off a cliff, "they are far less likely to reach a deal to help their country climb out of an abyss."

In separate commentaries Xinhua published on Tuesday on the fiscal cliff debate, it called on the United States to live up to its global economic responsibilities and also blamed its poorly functioning political system for the mess.

Such commentaries are not policy statements as such, but can be read as a reflection of Chinese government thinking.


© 2014 Thomson/Reuters. All rights reserved.

Share:
  Comment  |
   Contact Us  |
  Print  
  Copy Shortlink
Around the Web
Join the Newsmax Community
Please review Community Guidelines before posting a comment.
>> Register to share your comments with the community.
>> Login if you are already a member.
blog comments powered by Disqus
 
Email:
Retype Email:
Country
Zip Code:
 
Hot Topics
Follow Newsmax
Like us
on Facebook
Follow us
on Twitter
Add us
on Google Plus
Around the Web
You May Also Like

GAO: Obamacare Website Fixes Approach $1 Billion Mark

Wednesday, 30 Jul 2014 17:25 PM

The price tag for healthcare.gov, the Obamacare website, is approaching $1 billion even as key features remain incomplet . . .

House Approves $16.3 Billion VA Health Care Overhaul

Wednesday, 30 Jul 2014 17:15 PM

The House overwhelmingly approved a landmark bill Wednesday to refurbish the Veterans Affairs Department and improve vet . . .

Cruz Wants GOP House Members to Oppose Boehner Immigration Bill

Wednesday, 30 Jul 2014 17:01 PM

Sen. Ted Cruz will meet with a group of House Republicans to try to persuade them to oppose House Speaker John Boehner's . . .

Most Commented

Newsmax, Moneynews, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, NewsmaxWorld, NewsmaxHealth, are trademarks of Newsmax Media, Inc.

 
NEWSMAX.COM
America's News Page
©  Newsmax Media, Inc.
All Rights Reserved