Off To Asia

It is neither unusual nor counter-intuitive for foreign policy and economic policy to be intertwined, and so it is today. The Washington Post reported Sunday that Secretary of State Hillary Clinton

departs today for Asia on her maiden voyage as the nation's chief diplomat, and Tokyo snared the symbolically important first stop on four-nation tour. But Clinton and other Obama administration officials have made it clear that they want to move dramatically forward in relations with Beijing, finding new avenues for cooperation between the world's biggest economy and the world's fastest-growing economy, especially on climate change and the environment.

It's hard to determine how a nation can "move dramatically forward" in relations with a regime which sends weapons to fuel conflicts in Sudan, Burma, and Nepal; arms thugs in Iran, Iraq, Myanmar, North Korea, Pakistan, and Thailand; transfers nuclear weapons technology; threatens neighbors with a massive military buildup; oppresses Tibet; and actively encourages abortion and sterilization.

Still, the United States cannot neglect completely the Butchers of Beijing. In the wake of passage of the $787 billion stimulus bill, the nation's budget deficit, otherwise expected to hit $1.2 trillion dollars this year, is expected to hit $1.4 trillion. Money can be printed- posing an eventual threat of hyperinflation- or borrowed, largely from the mainland Chinese or from banks in Japan, a nation itself suffering its worst economic downturn since 1974.

But there is good news: our status as a debtor nation to Beijing may not further distort our relationship with the totalitarian regime. Luo Ping, a director-general at the China Banking Regulatory Commission, told reporters "Except for U.S. Treasuries, what can you hold? Gold? You don't hold Japanese government bonds or U.K. bonds. U.S. Treasuries are the safe haven. For everyone, including China, it is the only option."