Washington: The US Senators have demanded that the country must refuse to pay back the $1 trillion debt to China. The demand was put forth by Senator Martha Blackburn and Lindsey Graham, two Senior members of the US Senate. The American people, as also political circles strongly believe, the US must make China pay for the damages caused to the US due to the Novel Coronavirus Pandemic since China was responsible for it. The latest demand on the US Treasury bonds is an expression of the same sentiment.
The US government is under a national debt of worth nearly $24 trillion, of which $1.08 trillion are in the form of US Treasury bonds held by China. The debt is in the US dollar and part of China’s foreign reserves, which are over $3 trillion. The Chinese government uses these to maintain a stable value for its national currency Yuan against the US dollar. Furthermore, the US government is required to pay the interest rates for the US Treasury bonds held by China.
Given the US-China trade war, as also the diplomatic war the US has initiated against China over the Coronavirus, the matter concerning the US Treasury bonds is being raised repeatedly. Previously, US analysts and think tanks had suggested the use of the Treasury bonds as a ‘nuclear option’ against China. However, now the US Senators are directly making the demand and has thus drawn much attention.
Marsha Blackburn, a senior Senator from the US state of Tennessee, has insisted the US reject China’s holdings of the US Treasury bonds. Senator Blackburn’s demand received backing from senior Republican Senator Lindsey Graham. Senator Graham supported the request of shirking off the responsibility from China’s holdings of the US Treasury bonds saying, ‘They (China) should be paying us, not us paying China.’ John Yoo, a law professor at the University of California, supported the US Senator’s proposal. ‘The US can go for this alternative to make up for the damages caused due to the Coronavirus, which had originated in China,’ Professor Yoo said.
Previously, US President Donald Trump and Secretary of State Mike Pompeo had warned the Chinese Communist Party that it would have to pay for the Covid-19. On the other hand, Germany demanded China pay $165 billion as Coronavirus damages. Also, US President Trump had warned that the US would recover more damages from China for Coronavirus, and the amount would be significantly more than what Australia had asked. ‘China has caused tremendous loss of life and damage to the US economy by hiding information on the Coronavirus. The Chinese Communist Party will have to pay the price for what they did,’ Secretary of State Mike Pompeo said. Pompeo indicated that it would be on the level of economy and trade.
Meanwhile, information has surfaced that China has sold $36 billion of its US Treasury holdings in the international market.
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