'Rediculous' Health Insurance Comment' - and ridiculous spelling.

You are right, Nap. I guess I was so angry that I was seeing "red". I caught it after I've posted it But couldn't edit the title. It happens.

;)

tonyaod
www.foxnews.com/opinion/2011/08/26/its-time-for-china-to-pay-its-debts-to-united-states.html

fox news would say stuff like that.
Even if true would it cover the 1.7 trillion US debt is to China today?
E.g useconomy.about.com/[...]

If China calls in those debts - goodbye dollar

The link was posted at tony's request - other verbiage and profanities aside. I understand Tony was upset at the original article (?), so will assume I was just collateral damage from that initial inspiration to post, or not.

It's better I start a separate thread - as what I was looking for isn't really relevant to Tony's title.

Michael, Michael Michael....thank you for the entertainment, haven't had a good chuckle in a long time, but you are a man for defending your posts with sources.

First of all, anything fox news says needs to be taken with a grain of salt, spreading fear using dubious and sometimes outright lies. The issue in the article involves a "defunct" government issued bond that was purchased by private individuals and governments. Now, the "representatives" of those private individuals as well as "citizens" of the US government, is calling on the US government to expert political pressure to pay the defaulted loans. Setting aside any truthfullness of this issue, assuming such bonds were issued and never resolved, your source directly refuted your original statement of "It's also worth noting that China is the ONLY country in the world that paid off its entire war debt to the USA". It would seem that the China DID NOT pay off all of its debts. Second, this situation is far different from war reparations demanded by the US government as implied by "debts to the US". The US government is not taking action to recover these debts, from China or Taiwan. It is a misguided (fraudulent) effort by private citizens to try to recover money in which they have no legal claims to.

The article goes on to use the principle of "successor government" legitimize the shifting of the legal responsibility to pay the debt incurred under the KMT government. The flaw in this logic is that the PRC is not necessary seen as a successor government of the KMT, as evidenced by the special recognition of the government in Taiwan. Last time I check, the ROC still issues their own passports which is recognized internationally as valid. If the PRC is a successor state of the ROC, then why would world governments accept papers from a defunct entitiy? (try entering any country using an USSR passport)

Now, cutting away all the flammatory rhetoric from the fox news article, the only source I can find for their argument comes from an organization called American Bondholder's Foundation, LLC. A quick search would reveal that ABF is really a scam preying on gullible people, selling legal claims on these bonds for pennies on the dollar promising large returns through successful letigation to recover the value of the bonds.

There have been multiple lawsuits against ABF for fraud. In a nutshell, this is how the fraud works. ABF convinces people that these bondholders have a legitimate claim to recovere funds from the Chinese government, however, the original claimant are dead and the decendents no long wish to pursue legal action. With a small investment of pennies on the dollar, anyone can purchase the bonds from the claimants and become the legal owner of the debt, in which ABF would be more than happy to facilitate such transfers (for a small fee, of course). Then, as ABF pursues legal action against the Chinese government (in which they will prevail, of course) then these new bond holders will gain millions.

So upon analysis, fox news is using a dubious (fradulent) source to incite the public with their own hidden agenda, which is to spread hatred towards China. It was a good try and I applaude you for providing a source, something that most people here wouldn't do, however, try harder next time.

===================================================
Sources:

American Bondholder's Foundation website
www.americanbondholdersfoundation.com/

Articles regarding ABF's actions:
www.thefreelibrary.com/[...]
www.prnewswire.com/[...]

Lawsuit:
Tanner v. American Bondholder Foundation, LLC et al
dockets.justia.com/[...]
docs.justia.com/[...]
docs.justia.com/[...]

Pierre F. Laband v. American Bondholders Foundation LLC et al

dockets.justia.com/[...]
www.plainsite.org/[...]

Bloomberg Article telling a more objective view of this issue:
www.bloomberg.com/[...]

NY Times Article regarding the relevant 1987 bond settlement with China.

In essence, China paid to gain access to British capital markets. It was an agreement between the two governments that did not work its way through court thus can not be used to provide any legitimacy to the claim that China has a legal obligation to pay the bonds. Basically, it's a case of a bully telling the little kids they must pay him if they wise to play on the playground.
www.nytimes.com/[...]

@Tony: Excellent analysis. I too spent some time searching for information and found many of the same references.

My conclusion is slightly different than yours. The UK demonstrated with leverage it is possible to get China to pay up.

Unfortunately, the US has a tendency to drop it pants and bend over in preparation for bilateral China negotiations. China is asking for, or has just obtained, greater access to the US financial markets. So far the US has conceded on financial statement audits and other regulatory requirements, Dodd-Frank, which burden US business.

The US may also have some leverage but the current administration is incapable finding it with either hand.

@Geezer

Objectively speaking, I think the material issues in this case are whether the PRC is a successor state to the ROC, and whether the PRC has any legal responsibility for the debts incurred pre-1949.

I think regarding the question of successor state, even the CCP's is contradictory in their position, playing up which ever argument is most advantageous to itself at the time. According to their own narrative, the people were 'liberated' from the government of the ROC. Then on Oct 1st, 1949, Mao declared the formation of the PRC as the 'new China', signaling that they are a separate entity from the ROC, allowing for both to co-exist. However, as the bamboo curtain started coming down, they've decided that Taiwan is part of the PRC and began to systematically change the history books to reflect this new view, with the era of ROC being listed as lasting from 1911-1949, where as Taiwanese textbooks list the ROC as 1911-Present.

Whether or not the PRC is responsible for the debts incurred pre-1949 depends on how one views the successor state question. China, by claiming Taiwan is part of China and that the ROC government is defunct, would find itself in the position to legally accept responsibility for all previous treaties and obligations. If they try to get out of such obligations, then they are inconsistent with their position. Therefore, it is quite natural for the British government to settle the debt incurred pre-1949 with the PRC. Since I am not familiar with British law and rhetorics, I will now switch to the US as an example. The US, by virtue of its protection act with the ROC government, recognizes the ROC as still existing, therefore, any Chinese obligations pre-1949 needs to take up with Taipei and not Beijing. Any other position is incompatible with this doctrine. In fact, post-1949, the US government continues to provide loans to support Chiang in hopes that he might recover the mainland. From the continued sales of arms to Taiwan, I can only assume that whatever debts were incurred has been resolved. If the payment of the bonds in question were to be pursued, then it must be pursed in Taipei, not Beijing, based on this position.

Regarding leveraging, I personally feel the British government at the time were acting on principle while the PRC were acting on practicality. Had China refused to pay, disavowing any responsibility for the debts, what could London do? And had China waited many more years, perhaps they could by pass London and gain access to capital in other markets anyway, eventually pressuring the British government to open up their capital markets to China without resolving the issue.

23 million pounds is not a lot of money to either country, and so I believe it was a calculated gesture on both parties to come out looking like winners and placating their own constituents.

On the political stance between the US and China. China is definitely playing hard ball, presenting itself to have a full house when they only have two pairs. Are they over playing their hand, perhaps. Is the US response too soft? Perhaps. I do personally believe that there are certain areas the US can take a harder stance and maybe some areas they are over zealous without taking into account of the Chinese perspective.

Ether way, Geezer, I highly respect your opinions even if we come to different conclusions. =)

Tony
I apologize for sending you on what seems to be a considerably time-consuming but enlightening wild goose chase and especially for toning down the profanity.

Upon further but nominal research, spurred on by your rebuttal, I must admit again, I don't really know what China's WW2 debts are at all and whether they have been paid off. It seems extremely convoluted (US Lend-Lease program) and difficult to track down reliably - published books tending to be significantly more reliable than internet searches.

The core issue was China was repaying war debts to the former USSR in part, using grain, which exacerbated an already bad domestic situation.

As mentioned and apparently verified, I was surprised that the UK repaid it's sizable war debt to the USA in full, to include interest payments. Not surprised that the UK repaid it - but surprised that the USA did NOT forgive the war debt, as it had with Japan and Germany - which were actually war reparations - a debt with a different name.

Geezer - similar regrets - it was NOT my intention to focus on war debts or reparations due diligence activities - but on the issue of sustainable healthcare for the masses.

The motivating philosophy was, "what kind of legacy/world would I like to leave behind for my children" and in a more practical and pragmatic perspective - if they worked for a company I helped found - what kind of sustainable health benefits would I want them to "inherit". The issue goes beyond healthcare - to the end of career retirement benefits.

Retirement benefits are at risk both here in China, Japan, and the USA (dunno about ANZ or UK), because of how the plans were structured (perpetual growth pyramid scheme).

So, in addition to robust sustainable healthcare, a robust sustainable retirement or retirement savings plan would also be in the mix.

This would perhaps go a long way to address any employee's biggest fear - long-term security, assuming the company had the ability to also be a long-term sustainable company, spanning the 30+ year employment cycle.