The US media said: China will rely on 860 billion US debts if it does not repay the old debts of the Qing Dynasty! China's counterattack left the United States dumbfounded

It is said that Trump is unreliable, but if you think about it carefully, he is not the only unreliable politician in the United States.

And how did a US congressman named Mark take a few old Chinese bonds and launch a bill that is even more unreliable than Trump against China?

The US side suddenly threw out a century-old debt

Once, an article in the American media "Capitol Hill Daily" set off waves of public opinion.

Parliamentarian Mark Green was quoted as saying that the "Huzhou-Guangzhou Railway Bonds" issued by the Qing government in 1911 are still valid today, and China needs to repay a total of $1.6 trillion in debt, including interest.

even threw out the threatening argument of "if you don't repay the money, you will rely on 860 billion US debts".

This absurd statement quickly attracted international attention, but when we opened the historical file, we found that this history was completely distorted by him.

The story begins in China in 1911.

At that time, in order to promote the construction of the Guangdong-Hanzhou and Sichuan-Han railways, the Qing government signed the "Huguang Railway Loan Contract" with a consortium of banks from Britain, France, Germany and the United States, agreeing to borrow 6 million pounds, of which the American bank group accounted for a quarter of the share.

However, this seemingly commercial cooperation agreement actually contains a clause on the transfer of sovereignty:

The contract stipulated that the two lakes and salt taxes and other financial revenues were used as collateral, and the foreign powers also demanded the right to build railways and the right to participate in the operation and management.

In the end, in order to build the railway, the Qing government endured it and signed this crushing contract, but when the Qing government handed over the borrowed fundraising funds to the American contractor to build the road, the other party ran away with the money.

In this way, the Qing government finally not only compensated his wife but also lost his soldiers.

The more than one million pounds (equivalent to more than $1 million dollars) borrowed from the United States at the beginning was also raised to $1.6 trillion by this politician in the name of "rolling profits."

But what is even more infuriating is that the "100-year-old Chinese debt" that this US politician has speculated has actually been terminated by the legal process, and China does not owe the United States anything...

The Truth About Debt

More than half a century ago, China and the United States have settled their disputes through legal procedures.

The 1943 New Treaty between China and the United States clearly stipulated that the United States would renounce all the privileges it had previously enjoyed in China under unequal treaties, including the right to claim debts under the Qing government.

The U.S.-China Asset Requirements Agreement, signed in 1979 on the occasion of the establishment of diplomatic relations between China and the United States, put an end to the problems left over from history in a more concrete way.

The Chinese government paid $80 million to the United States as a comprehensive settlement of claims for the historical assets of both countries.

It is worth noting that this amount is not an acknowledgment of debt, but is based on a political decision to resolve the problems left over from history.

Vance, then U.S. Secretary of State, made it clear at the time of the agreement that the move would "settle once and for all outstanding asset claims between the two countries."

Even more authoritative is the principle of "non-retroactivity" established in the Vienna Convention on the Law of Treaties.

The principle makes it clear that the new State is not under an inheritance obligation to the debts of the old State, especially those based on unequal treaties or that undermine the sovereignty of the State.

These legal bases constitute a complete chain of legal principles, which is enough to prove that the so-called "century-old debts" have no legal standing.

China's "century-old debt" is nonsense, but the $860 billion owed by the United States to China is justified and law-based.

Since China's accession to the WTO, the US government has borrowed more than $20 trillion from international investors, including China, through the issuance of treasury bonds.

As of 2022, China held about $860 billion in U.S. Treasury bonds.

From increasing its holdings of U.S. debt during the 2008 financial crisis to supporting the global economic recovery, to providing liquidity support to U.S. finances through multilateral mechanisms in recent years, China's every decision has been based on maintaining international economic stability.

Nowadays, China is getting stronger and stronger, and its international status is getting stronger and stronger, but on the other hand, the United States, its "debt collection" drama through time and space is actually a distorted projection of the current financial predicament of the United States...

The real purpose of the United States

Today, the electronic debt clock in New York Times Square has jumped to $31.4 trillion, and US GDP growth will fall to 0.1%, while inflation remains high at 4%.

What's more serious is that 6.5 trillion US dollars of Treasury bonds will mature this year, and the soaring cost of debt rollover caused by the Fed's aggressive interest rate hikes is plunging the fiscal into a vicious circle of "borrowing new to repay the old".

As traders at the Chicago Mercantile Exchange frequently tweaked their models of the probability of default, politicians in Washington began to look for "solutions" in the pages of history.

In fact, the so-called proposal to "use old Qing Dynasty debts to offset China's US debts" has already been revealed as early as April 2023.

At that time, a conservative think tank released a report, claiming that the "1911 bond contract" could be used as "financial leverage", trying to find a legal excuse for repaying the $860 billion in US debt.

This line of thinking continues the consistent practice of the United States in the Latin American debt crisis and the Asian financial turmoil.

When it is in crisis, it transfers the risk to other countries through the manipulation of public opinion and the reconstruction of rules.

Only this time, they are trying to use the more covert means of "historical debt" to cover up the truth that their debt chain is about to break.

However, China's position has always been clear and firm in the face of this financial bullying, which confuses right and wrong.

From the solemn response at the regular press conference of the Ministry of Foreign Affairs to the policy coordination under the framework of the International Monetary Fund.

China has always used international law and market rules as weapons to expose the real attempt of the US to undermine the international financial order with the dregs of history.

History will not change with the changes of the times, and facts will not disappear with clever denial.

The so-called "Huzhou-Guangzhou Railway Bonds" have long since lost their legal effect in the judgment of historical justice, and any attempt to impose the old ledgers of the colonial era on modern China is doomed to be a futile political farce.

In fact, the United States has more than once used this method of "turning over old accounts and turning over old accounts."

As early as the 19th century, the United States refused to repay its debt to Britain through the Jay Treaty; In the 20th century, the "Bretton Woods system" was used to reconstruct the global monetary order.

Today, with the steady progress of RMB internationalization and the reshaping of the payment system by digital currency, any attempt to maintain financial hegemony with colonial logic will be met with a bloody head in the face of a pluralistic and co-governed international order.

When American politicians are indulging in the "dream of a hundred years ago", perhaps it is better to heed Wall Street's warning:

What really threatens the credibility of US bonds is never the so-called "foreign debt", but the spirit of overdrawn contracts and the increasingly hollowing out of economic fundamentals.

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