“Beijing is not being ransomed. Our parents’ and our own retirement and our children’s, and grandchildren’s and great-grandchildren’s futures are what is being ransomed. That debt is literally orders of magnitudes greater than the piddling bit we own to the Chinese.”
Does it change the result predicted by the article? That either government programs would be cut or taxes raised?
Neither of those things are going to happen, per se.
The politicians will simply take the cowards way out by monetizing the debt. [Yes, I understand that this is effectively a tax on everyone.]
They have been preparing this route for a long time: First, by ditching the M3 money supply measure. This was the only measure not effectively under the control of the government and/or Fed. Second: by detaching inflation from most of the things we buy on a day-to-day basis. It was necessary to do this for at least two reasons: a) as more durable goods are manufactured oversees, it becomes much more difficult to say there is any inflation happening, especially as China and emerging 3rd world countries devalue their currency to stay competitive and b) It defeats the purpose of using inflation to pay for entitlements if COLA's are permitted to rise. Third, by applying downward wage pressure on US citizens, which makes them more likely to accept real-value reduced wages. Fourth, of course, by flooding the market with fake money, so increasingly worthless currency becomes the new norm.