Does anyone have a dollar amount on how much of our debt China owns?* I heard a report last year on NPR where an economist was wetting himself at the thought of China dumping the dollar for the euro. He sounded scared. It, in turn, freaked me out a little bit.

Misty, over at Saintless, sent me this article from CNN asking why we’re still doing business with China:

Halloween ‘Ugly Teeth’ recalled over high lead levels

WASHINGTON (AP) — The government announced an 11th-hour recall Wednesday to warn consumers that fake Halloween teeth sold by the tens of thousands since last year contain excessive amounts of lead.

The $2 packages of “Ugly Teeth” are only the latest in a long line of Chinese-made toys and novelty items recalled because of lead. The Consumer Product Safety Commission announced the recall on Halloween, in a late-morning news release.

The agency estimates that since January 2006, retailers have sold about 43,000 eight-piece packages of the party favors. There were no immediate reports of injuries or illness.

Amscan Inc. of Elmsford, New York, imported the fake teeth. A message left with the company was not immediately returned.

My answer? Because we have to. And it’s not a Bush thing, really, either. The American Government has been kissing China’s ass for decades because China keeps loaning us money. We cut off their exports, they recall the debt, or dump the T-bils nd grab the Euro, and, seriously, we’re screwed.

President Clinton gave us the best chance at protecting ourselves by paying down the deficit, but, when he went out of office, the Republican Congress and the former Governor of Texas reversed the self sustaining trend and got us into hotter water at three times the depth.

I’m not saying that Clinton was doing it to get us out from under China, but, the thing about paying off your debts is: When your brother calls to remind you about the $200 bucks you owe him and then asks to borrow your car, you have no moral standing to say no. If he asks and you don’t owe him anything, you can laugh the whole time you’re hanging up on him.

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And, Misty comes through again ( in the comments) to give me a Halloween Scaryashell:

In recent years, the debt has soared and inflation has stayed low in part because China has been willing to accumulate reserves denominated in U.S. Dollars. Currently, China holds over $1 trillion in dollar denominated assets (of which $330 billion are U.S. Treasury notes). In comparison, $1.4 trillion represents M1 or the “tight money supply” of U.S. Dollars which suggests that the value of the U.S. Dollar could change dramatically should China ever choose to divest itself of a large portion of those reserves.

http://en.wikipedia.org/wiki/United_States_public_debt