IN OTHER WORDS
Public derision in America of the Republicans’ idea for a $100 gasoline rebate has focused on the desperate political pandering embodied in the proposal. But there’s another view
that makes it seem even worse: China angle.
With the US already deeply in debt, lawmakers would need to borrow $10 billion to make the rebates happen. Since more than 80 per cent of the borrowing of the Bush years has been from foreigners, it’s safe to assume that most of the rebates would be courtesy of foreign lenders, of which China has been one of the most willing. It’s the circle of crude: China’s competition for the world’s oil is pushing up prices. Congress piles on more debt to calm angry consumers with a rebate. The increased debt is a prescription for a weaker dollar, which in turn would make imports, including oil, even more expensive.
Dealing with the effects will require strong and savvy diplomacy. America’s outsized needs for the same resources that China covets, plus its need to borrow from China and other countries, diminishes its influence with countries whose importance goes beyond that of their oil.
As of now, the level of America’s response to new challenge has been embodied in pathetic recipe: Borrow money from the Chinese central bank, and use it to give every voter $100 to buy more gas. — The New York Times