Thanks For Your Contribution

By: Mr. Curmudgeon
mrcurmudgeon@inthepublicsquare.com

If you have money you can make the ghosts and devils turn your grind stone

--Ancient Chinese proverb

Long before the Nobel committee bestowed the Peace Prize upon him for ending global war by promoting global warming, Al Gore was the Democratic Party and Clinton Administration bagman for illegal campaign contributions.

In 1996, while attending a fundraising luncheon at the His Lai Buddhist temple in Hacienda Heights, California, then Vice President Gore received $140,000 in illegal political contributions from agents of the communist Chinese government. As the scandal began to unravel, the scope of China’s financial support for the Democratic Party became clear. In testimony before the U.S. Senate, a Democratic fund-raiser from California, Johnny Chung, told lawmakers how he had formed a holding company (Marswell Investments) to funnel laundered Chinese cash contributions to the Democrats. Chung recalled a meeting he had with the man who would later become his silent partner. “We really like your president [Clinton],” the mystery man told Chung. “I will give you $300,000 U.S. dollars…you can give it to your president and the Democratic Party.” The silent partner was General Ji Shengde, chief of China’s military intelligence.

In 1997, after President Bill Clinton’s successful re-election, an embarrassed Democratic National Committee meekly returned $3 million in shady Chinese contributions. No indictments were issued for any Clinton administration facilitators involved in what became known as Chinagate.

The world has turned many times since the glory days of the Clinton presidency, but Chinese money remains a central component of American life.

It was Chinese money that filtered into our nation’s economy through their purchase of U.S. Treasuries. This money underwrote U.S. government debt as well as low interest loans that helped finance our nation’s housing bubble. With China’s impressive $2 trillion in currency reserves, the Obama administration is turning to Beijing for cash to help pull the U.S. out of the worst economic collapse since the Great Depression.

In a televised interview, CNBC’s Mad Money host Jim Cramer said: “Thank heavens for the Chinese communists, deeply rooted in a profit government, because we [the U.S.] have decided that profits have no place in the system.”

Of course, Jim Cramer was referring to President Obama’s statement to Wall Street executives that “now is not the time for profits,” which precipitated a 300-point plunge in the Dow Jones Industrials to a level not seen since 1997. “I’m not saying, ‘Mr. President, go to the Bloomberg quote machine and come to your senses,’ said Cramer at the close of that day’s dismal trading. “I just want some sign that Obama realizes the market is totally falling apart and that his agenda has a big hand in that happening. I’m not saying that what’s good for the stock market is always what’s good for America, but right now it sure is. Stability is what matters most here; stability is measured by the stock market. That stability has vanished. You can’t trash the market along with housing without causing a tremendous surge in poverty – maybe social unrest. And Obama is doing both with this budget of his. Here’s the bottom line: given the times we’re in, we can not afford the President’s agenda.”

The lynchpin to Obama’s behemoth $3.5 trillion budget for fiscal 2010 rests on convincing China to spend hundreds of billions of dollars underwriting the president’s gargantuan stimulus debt.

“It would not be in China 's interest if we were unable to get our economy moving,” said Secretary of State Hillary Clinton in a television interview during her recent visit to China. “So by continuing to support American Treasury instruments, the Chinese are recognizing our interconnection. We are truly going to rise or fall together. We are in the same boat and, thankfully, we are rowing in the same direction…the Chinese know that to start exporting again to their biggest market, namely the United States, the United States has to take some very drastic measures with this stimulus package, which means we have to incur more debt.”

Some of China’s communist pro-capitalists don’t quite see it that way. In a statement to the Bloomberg financial news service, Zhang Ming, Secretary General of the International Finance Research Center at the Chinese Academy of Social Sciences said, “I don’t think we [China] should increase [U.S. Treasury] holdings because the medium and long-term risks are quite high.” He urges that China “diversify its reserves away from U.S. Treasuries if the value of China ’s foreign-exchange reserves is in danger of being inflated away by U.S. government pump-priming.”

China has lost half of its $10 billion dollar investment in Wall Street and, according to Bloomberg News, is currently the largest holder of U.S. Treasuries – totaling $696 billion.

Luo Ping, a director-general at the China Banking Regulatory Commission, said after a speech in New York City, “We hate you guys. Once you start issuing $1 trillion-$2 trillion [in treasuries]…we know the dollar is going to depreciate, so we hate you guys but there is nothing much we can do.”

The supreme irony in all of this is that China, attempting to avoid the fate of Soviet Russia, turned to state capitalism as an acknowledgment of economic reality. Now a Clinton, no less, is telling the Chinese that continuing their peculiar brand of capitalism is only possible so long as they are willing to underwrite Obama’s peculiar brand of socialism. The wealth-destroying machine that is the Democratic Party, thanks to China, is about to achieve global reach.

Obama and his party may now have the financial means to buy the votes needed to maintain power – thanks to an over-burdened American taxpayer and the Democratic Party’s largest – if reluctant – campaign contributor, The People’s Republic of China.

The Chinese once attempted to buy influence within the Democratic Party. Now the Democrats have turned the tables and are poised to extort it from them. The ancient Asian dragon is about to learn an old Western proverb the hard way: be careful what you wish for – you might just get it.