Will the Chinese veto U.S. Health Reform

Are the only people watching our government spending located in Beijing?

Now that the Blue Dog Democrats and some Republicans in the house have agreed on a watered down health care reform package, yet to be fully outlined, we can start actually looking at how and who is going to pay for this reform.   Of the six goals outlined in the Presidents wish list on health care reform, it looks like only two are going to come to full fruition in a bill.   Guaranteed access to insurance for individuals, and a tax on health care packages that exceed $25,000 of annual value.  

This scaled down model of health care reform might not meet with approval of the American Public.  Polls taken between July 17-20, before the latest outrage, showed that President Obama did not have a plurality of support from those with private health plans.  It;s fair to say that if a poll were taken this week, the support would probably be even less.   This is even before any middle class family (defined as 4x the federal poverty level per proposed subsidy cut offs at 300% of FPL) realizes that their taxes would be going higher to pay for a plan that they will most likely not benefit from.  

Once the actual bill is published.  It will be gone over with a fine tooth comb by those on the left and the right.  One can expect that Fox News will bash it, and MSNBC will be supportive.  CNN and the NYT will most likely present both sides with a moderately left leaning.   BIg deal, I say.   What will Beijing say?

In June , Tim Geithner, US Treasury Secretary went to China to address the budget deficit issue and explain our 13% of GNP deficit this year, and a predicted 3% of GNP deficit next year, assuming a economic recovery, and to tell the Chinese not to worry.   China who currently owns an estimated $2 trillion of our bonds, and we assume will pick up another $500 billion soon, may ultimately have something to say about how health care reform goes, if it does.   They won’t necessarily offer public statement, but while most American’s think that ‘health care reform’ means “saving me money”, if the bill doesn’t deliver, and the government has to sweeten the deal to make it more attractive (meaning additional deficit spending), China might start dumping dollars and bonds.  

With the U.S. deficit financed by China, much like AIG is financed by the US Government, If you are looking to the political party that might really have the say so if we have health care reform in 2009, look East..  Far East…  

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