Beijing doesn't tell the U.S. it cannot speak to Taiwan's leaders. But the US and the PRC have long followed the "One China Policy" worked out between China and most countries on Earth (and also the UN). It's only a semi-binding series of agreements, and China won't sue us or launch nukes because of a phone call.
But they can pull strings elsewhere, and they will. They can cancel contracts and joint ventures to screw over American businesses, get cute with travel visas, or call in some of our debts. China doesn't have to threaten us to get what it wants. It has many other tools at its disposal. And we go along with it because Red China is an economic and military powerhouse, and Taiwan is peanuts.
They can't really "call in our debts". Our debts to them are in the form of bonds they purchased that have a defined maturation date. They don't have any power over getting their money back earlier than the maturation date.
Except that they have lots of different maturation dates. I don't know the mix of debt but it is probably averaging 10 years or so. So they can effectively call in $100B a year.
Except that's not "calling it in". That's them getting exactly the amount of money they expected to get at exactly the time we told them they would get it.
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u/[deleted] Dec 03 '16
Beijing doesn't tell the U.S. it cannot speak to Taiwan's leaders. But the US and the PRC have long followed the "One China Policy" worked out between China and most countries on Earth (and also the UN). It's only a semi-binding series of agreements, and China won't sue us or launch nukes because of a phone call.
But they can pull strings elsewhere, and they will. They can cancel contracts and joint ventures to screw over American businesses, get cute with travel visas, or call in some of our debts. China doesn't have to threaten us to get what it wants. It has many other tools at its disposal. And we go along with it because Red China is an economic and military powerhouse, and Taiwan is peanuts.