Become a digitalPLUS subscriber. 99¢ for 4 weeks.

Upset over U.S. fiscal crisis, China urges a 'de-Americanized world'

FinanceInternational Military InterventionsU.S. Debt CeilingChinaNational Government

WASHINGTON -- Upset that the fiscal stalemate in Washington is threatening the global economy, China called for the U.S. dollar to be replaced as the international reserve currency as well as for broader steps to create a "de-Americanized world."

China also called for an end to the "pernicious impasse" in the U.S. over the raising the debt limit and ending the partial government shutdown, saying the world needed another reserve currency so nations could protect themselves "from the spillover of the intensifying domestic political turmoil in the United States."

Most countries hold their foreign exchange reserves in U.S. dollars because the currency is viewed as the world's most stable. China is the largest foreign holder of U.S. debt, with about $1.3 trillion in Treasury bonds, and is concerned about the impact of a U.S. failure to raise the debt limit on those holdings.

With Washington politicians still far from a deal as the Thursday deadline for raising the $16.7-trillion debt limit looms, China's official state-run news agency published a sharply worded editorial Sunday criticizing U.S. leadership.

QUIZ: Test your knowledge about the debt limit

"As U.S. politicians of both political parties are still shuffling back and forth between the White House and the Capitol Hill without striking a viable deal to bring normality to the body politic they brag about, it is perhaps a good time for the befuddled world to start considering building a de-Americanized world," the Xinhua news agency said in an English-language commentary.

China's concerns echo those of economic officials around the world about the effects of a failure to raise the U.S. debt limit, which could trigger the federal government's first-ever widespread default.

Christine Lagarde, head of the International Monetary Fund, told NBC's "Meet the Press" on Sunday that global finance ministers are worried the uncertainty surrounding a U.S. default "would mean massive disruption the world over, and we would be at risk of tipping yet again into a recession."

The Xinhua editorial took swipes at the U.S. for claiming "the moral high ground" while "covertly doing things that are as audacious as torturing prisoners of war, slaying civilians in drone attacks, and spying on world leaders."

While slamming the U.S. for the Iraq war and military activity around the world, the article focused much of its fire on the U.S. role in the global economy, saying "the world is still crawling its way out of an economic disaster thanks to the voracious Wall Street elites."

"Most recently, the cyclical stagnation in Washington for a viable bipartisan solution over a federal budget and an approval for raising debt ceiling has again left many nations' tremendous dollar assets in jeopardy and the international community highly agonized," Xinhua said.

Xinhua called for a "a new world order" in which "all nations, big or small, poor or rich, can have their key interests respected and protected on an equal footing."

That new order should start with respect for the sovereignty of other nations, the editorial said. It also should include major financial reforms, such as allowing developing and emerging economies to have more say in the operations of the International Monetary Fund and the World Bank, it said.

ALSO:

Three Americans win Nobel Prize in economics

Airlines target passengers with new luxury extras

Fannie Mae, Freddie Mac to go after more strategic defaulters

Copyright © 2014, The Baltimore Sun
Related Content
FinanceInternational Military InterventionsU.S. Debt CeilingChinaNational Government
  • Police shootings spur workers compensation awards
    Police shootings spur workers compensation awards

    Ever since her bipolar, unarmed son was shot and killed during a struggle with Baltimore police, Marcella Holloman has felt a sense of soul-crushing loss. She breaks out into shakes, and feels angry all the time. She sees other happy families — and resents them.

  • Hopkins picked to create Ebola training tool
    Hopkins picked to create Ebola training tool

    Federal health regulators picked Johns Hopkins Medicine on Friday to lead development of a Web-based tool to train doctors, nurses and other health care workers on the protocols they should follow when treating patients with, or at risk of contracting, Ebola.

  • Police search Towson U office of rabbi
    Police search Towson U office of rabbi

    Police searching the Towson University office of a prominent Georgetown rabbi accused of secretly recording women in a ritual bath found a backpack with an assortment of tiny cameras hidden in everyday household objects, including a computer charger, a clock and a tissue box, according to a...

  • In rare move, hands-on Ulman seeks job as No. 2
    In rare move, hands-on Ulman seeks job as No. 2

    Democrat Ken Ulman, dressed in Lucky jeans and a polo shirt, strode to the entrance of Robinson Nature Center, excited to give a tour of one of his favorite accomplishments as Howard County executive.

  • Rutherford known for 'making the trains run on time'
    Rutherford known for 'making the trains run on time'

    Boyd Rutherford was raised in a Democratic family in Democratic Northeast Washington, but the running mate of Republican Larry Hogan says he decided early on that the GOP was closer to his values.

  • Sun endorsement: Brown for governor
    Sun endorsement: Brown for governor

    Our view: The race presented a difficult choice, but we believe the lieutenant governor would be better able to enact the changes needed to maintain Md.'s prosperity

Comments
Loading