I.O.U.S.A. by Addison Wiggin, Kate Incontrera, Dorianne Perrucci Page B
Tags: United States, General, History, Business & Economics, Finance, Economic Conditions, Personal Finance, Forecasting, Public Finance, Economic forecasting - United States, Economic forecasting, Finance - United States - History, Debt, Debt - United States - History
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Figure
Source:
65
c04.indd 65
8/26/08 8:59:53 PM
66 The
Mission
who was part of the Pulitzer Prize – winning team at the Wall Street Journal that chronicled the effects of China
’ s rush to
capitalism.
“ China ’ s probably the biggest global economic story that there is going right now. It affects everything from big business, Wall Street, to down - home America, ” Mr. Areddy told us in his offi ce in Shanghai.
We traveled to Shanghai, China, to get a fi rsthand glimpse of this economic boom. The country was bounding with energy. As we walked through the streets, we got the feeling this is what it would have been like to witness the United States ’ Industrial Revolution. Around every corner was a construction crane, putting in new skyscrapers.
While we were in China, we were introduced to one gen-tleman, David Chia, who embodied what most would consider the American entrepreneurial spirit.
“ I have a mission, ” he told us, while we drove to visit the worksite of his new factory. “ We want to make a brand name, we want to make a good factory. We want to make some nice
We noticed
something that is products. We want to catch up with somebody in front of us.
uniquely Chinese: We know what our future is, and frankly, I never imagined By and large, they
I could own such a land and make such a big building. ”
save their money —
While the Chinese may embody the pursuit of the even if it means
American Dream, we noticed something that is uniquely living with a sort of
frugality that would Chinese: By and large, they save their money
— even if it
never cross most
means living with a sort of frugality that would never cross Americans ’ minds.
most Americans ’ minds.
While touring Mr. Chia ’ s existing factory, where they made light bulbs, we sat down with a young Chinese couple to ask them what everyday life is like for them. The young man told us, “ Saving money is one of the Chinese traditions. We each make ten dollars a day. After paying our bills, we can save more than half our earnings. We know what a rainy day looks like so we know how important it is to save. Everyone should have a goal in life. Our goal is to live in a quiet neighborhood.
Or maybe have a car. ”
c04.indd 66
8/26/08 8:59:54 PM
Chapter 4 The Trade Defi cit 67
Although the Chinese had different attitudes about saving their money and were much more willing to live a very simple life, without many personal belongings, there are some striking similarities between the Chinese and American people. Our visit to Shanghai showed us that Chinese people are worried about the same things that Americans worry about: their health care, their retirement, and how to boost their income. However, what scares a lot of Americans about China ’ s growing prowess — and the $ 1 trillion - plus in foreign exchange reserves — is that a lot of that money is invested in U.S. Treasury bonds and U.S. government debt.
“ A lot of people worry that A lot of people worry that some-somehow China ’ s going to suddenly
how China ’ s going to suddenly
ask for its money back and walk ask for its money back and walk away from the U.S. economy, ” said away from the U.S. economy. One Mr. Areddy.
“ One wouldn
’ t exist wouldn ’ t exist without the other, and I think, increasingly, the rela-without the other, and I think, tionship between China and the increasingly, the relationship between
United States is growing tighter —
China and the United States is grow-
at least economically.
ing tighter — at least economically. ”
— JAMES AREDDY
We Think, They Sweat
In China, the emphasis is very much centered around saving and preparing for the future. We know that in America, the opposite is true. The United States is focused on consumption and living in the now. However, if the country is going to fi nance its debt and have any chance of meeting its long -
term obligations to its retiring elderly or
Figure
Source:
65
c04.indd 65
8/26/08 8:59:53 PM
66 The
Mission
who was part of the Pulitzer Prize – winning team at the Wall Street Journal that chronicled the effects of China
’ s rush to
capitalism.
“ China ’ s probably the biggest global economic story that there is going right now. It affects everything from big business, Wall Street, to down - home America, ” Mr. Areddy told us in his offi ce in Shanghai.
We traveled to Shanghai, China, to get a fi rsthand glimpse of this economic boom. The country was bounding with energy. As we walked through the streets, we got the feeling this is what it would have been like to witness the United States ’ Industrial Revolution. Around every corner was a construction crane, putting in new skyscrapers.
While we were in China, we were introduced to one gen-tleman, David Chia, who embodied what most would consider the American entrepreneurial spirit.
“ I have a mission, ” he told us, while we drove to visit the worksite of his new factory. “ We want to make a brand name, we want to make a good factory. We want to make some nice
We noticed
something that is products. We want to catch up with somebody in front of us.
uniquely Chinese: We know what our future is, and frankly, I never imagined By and large, they
I could own such a land and make such a big building. ”
save their money —
While the Chinese may embody the pursuit of the even if it means
American Dream, we noticed something that is uniquely living with a sort of
frugality that would Chinese: By and large, they save their money
— even if it
never cross most
means living with a sort of frugality that would never cross Americans ’ minds.
most Americans ’ minds.
While touring Mr. Chia ’ s existing factory, where they made light bulbs, we sat down with a young Chinese couple to ask them what everyday life is like for them. The young man told us, “ Saving money is one of the Chinese traditions. We each make ten dollars a day. After paying our bills, we can save more than half our earnings. We know what a rainy day looks like so we know how important it is to save. Everyone should have a goal in life. Our goal is to live in a quiet neighborhood.
Or maybe have a car. ”
c04.indd 66
8/26/08 8:59:54 PM
Chapter 4 The Trade Defi cit 67
Although the Chinese had different attitudes about saving their money and were much more willing to live a very simple life, without many personal belongings, there are some striking similarities between the Chinese and American people. Our visit to Shanghai showed us that Chinese people are worried about the same things that Americans worry about: their health care, their retirement, and how to boost their income. However, what scares a lot of Americans about China ’ s growing prowess — and the $ 1 trillion - plus in foreign exchange reserves — is that a lot of that money is invested in U.S. Treasury bonds and U.S. government debt.
“ A lot of people worry that A lot of people worry that some-somehow China ’ s going to suddenly
how China ’ s going to suddenly
ask for its money back and walk ask for its money back and walk away from the U.S. economy, ” said away from the U.S. economy. One Mr. Areddy.
“ One wouldn
’ t exist wouldn ’ t exist without the other, and I think, increasingly, the rela-without the other, and I think, tionship between China and the increasingly, the relationship between
United States is growing tighter —
China and the United States is grow-
at least economically.
ing tighter — at least economically. ”
— JAMES AREDDY
We Think, They Sweat
In China, the emphasis is very much centered around saving and preparing for the future. We know that in America, the opposite is true. The United States is focused on consumption and living in the now. However, if the country is going to fi nance its debt and have any chance of meeting its long -
term obligations to its retiring elderly or
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