China Joins the Tea Party, France and Russia Shrug

Another Tea Party politician on a rant:

The days when the debt-ridden Uncle Sam could leisurely squander unlimited overseas borrowing appeared to be numbered.

The credit rating cut is an overdue bill that America has to pay for its own debt addition and the short-sighted political wrangling in Washington.

To cure its addiction to debts, the United States has to reestablish the common sense principle that one should live within its means.

If no substantial cuts were made to the U.S. gigantic military expenditure and bloated social welfare costs, the downgrade would prove to be only a prelude...

The U.S. government has to come to terms with the painful fact that the good old days when it could just borrow its way out of messes of its own making are finally gone.

No, those zingers are from an editorial in Xinhua, China's official news agency. The one thing China does not demand is that the U.S. raise taxes, so that puts China firmly in the Tea Party camp. The commentary also contained some ominous rumblings:

China, the largest creditor of the world's sole superpower, has every right now to demand the United States to address its structural debt problems and ensure the safety of China's dollar assets.

International supervision over the issue of U.S. dollars should be introduced and a new, stable and secured global reserve currency may also be an option to avert a catastrophe caused by any single country.

We should remind China that while the U.S. has gotten drunk on debt, China has been the enabler. Yes, the U.S. may "rely on the deep pockets of major surplus countries to make up for its perennial deficits." But China, the major surplus country, has unrealistically relied on the U.S. for a safe place to park those surpluses.

For the old Chinese communists there is no going back to the good old days of safely stacking Chinese trade surpluses in U.S. Treasuries either. The "largest creditor of the world's sole superpower" will just have to learn that great American axiom: buy the ticket, take the ride.

Europe, which has its own problems, is being more philosophical about the downgrade:

"We will not review it, because there is not much difference between AAA and AA+," says Russia's Deputy Finance Minister Sergei Storchak.

"France has a total confidence to the solidity of American economy and its fundamentals, as well as to the determination of American government to implement the educing deficit plan approved by the Congress this week," says France's Economy Minister Fracois Baroin.

You know you are in trouble when France condescends to express its total confidence in you. France is one of 18 countries still holding a AAA debt rating from S & P. Russia's rating is BBB. China's rating is AA-. Yes, the harsh critic is also in Alcoholics Anonymous, with the U.S. and 11 other countries.