EconomyinCrisis.org has pointed out on many occasions the negative side effects of the United States having so much dependence on other nations. One nation in particular (China) has an inordinate impact on American policies due to the huge amount of financing it offers our Treasury Department.

The United States has maintained a legacy of leadership on a global scale since the 1940s, but that position has been challenged over the past decade. Now, instead of living a legacy of leadership, we have a legacy of deterioration. America is still, by far, the world’s foremost military power; but its unilateral economic power is gone, and its diplomatic muscle took a huge hit during the second Bush administration.

America’s deterioration on an international scale has been given little face time in the media. In particular the reasons for the deterioration have been largely ignored. Major media are quick to highlight the quagmire that has become of the United States’ wars in Iraq and Afghanistan, but they have never focused on the other fronts where America is still losing ground.

Recently The Wall Street Journal, ran an article outlining the fact that America has become a sort of global debtor. The United States carries more debt than any other national government in the world. Our total national debt is now roughly 85 percent of the total value of our GDP.

Other nations carry more debt proportionally, but no advanced economy relies so heavily on foreign financing to service that debt. In other nations the vastness of the national debt is owed to citizens through bond programs. Until the Second World War the U.S. funded its debt almost exclusively through bond sales, and it owed repayment to its citizens.

Owning government bonds used to be a very popular investment in the U.S., and it was constantly pushed in the media, but it is much less prevalent today. Now, instead of asking citizens to shore up its debt holdings, the Treasury opens its coffers to other national wealth funds. As these foreign interests begin to collect more and more stockpiles of American debt, the money to purchase that debt buys them more and more influence over American policies. You must, after all, cater to your bondholders be they foreign or domestic.

The problem with this is when nations, like China, build up such large stockpiles that they can forcibly sway any issue they choose. When this is coupled with the fact that Beijing and Washington have diametrically opposed goals and interests we have a real obstacle to progress. The U.S. loses hundreds of billions of dollars to trade deficits with China, and every economist knows precisely why these deficits exist. Yet we are unable to do anything, because whenever the U.S. tries to hold down the outflow of cash and jobs China reacts by threatening to stop funding our debt.

The United States has long supported the independence and autonomy of Taiwan, the so-called Republic of China, but the Chinese officials have challenged support publicly.

When giving sworn testimony to Congress soon-to-be Treasury Secretary Geithner declared China to be an illegal manipulator of currency. Chinese officials immediately called for an apology, and one was promptly given.

In September 2006 Congress awarded the Dalai Lama, the leader of Tibet’s exiled self-government and spiritual leader for all Tibetan Buddhists, the Congressional Gold Medal. China responded claiming that the award wounded Chinese pride and internal affairs. In October 2009 President Obama had scheduled an appointment to meet with the Dalai Lama and canceled due to Beijing’s protests. According to The New York Times, the president had hoped to meet with him again in February 2010 and China is once again requesting that the White House abstain.

These are only a few of the many instances in which Beijing’s growing influence in Washington, D.C. has manifested itself. The U.S. used to go to China for talks about human rights, environmental protections, and building a middle class. Now, American diplomats typically spend their time discussing the safety of future Chinese investments in our indebted economy.

The United States cannot function on an international scale when one country carries such grand influence over our affairs. Unfortunately, the U.S.-China tie is only becoming stronger, and more one sided, as time goes on.

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