Gordon Chang: U.S. Should Seize China’s $1 Trillion in Treasury Obligations as Coronavirus Compensation

FILE - In this Aug. 6, 2019, file photo, a man walks by a money exchange shop decorated with Chinese yuan banknotes and other countries currency banknotes at Central, a business district in Hong Kong. China allowed its yuan to sink to an 11-year low against the dollar after U.S. …
AP Photo/Kin Cheung, File

America can seize China’s holdings of U.S. Treasury obligations as compensation for the one-party state’s negligence related to the coronavirus pandemic, said Gordon Chang, Daily Beast columnist and author of The Great U.S.-China Tech War, offering his remarks on Monday’s edition of SiriusXM’s Breitbart News Tonight with host Rebecca Mansour and special guest host Ed Martin.

China owns approximately $1.2 trillion in U.S. Treasury holdings.

Chang said, “What the United States can do is just simply seize the treasury obligations that China holds in their own name, they hold a little more than a trillion U.S. dollars in treasuries, probably through nominees they hold some more.”

Chang continued, “But what I recommend is that we not do this alone, and the reason is that China would say that this was a repudiation of debt. They would say that we were bad stewards of the global financial system. They would just tar us and they would actually go after the dollar.”

“What we can do is work with the issuers of other major currencies,” added Chang. “For instance, the Canadian dollar, the pound, the Swiss Franc, the euro, the yen, if we were to do that, and if all these countries were going to confiscate assets, then we have the makings of a real solution.”

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Chang said, “Of course, we can never get enough to compensate the world for what happened. We’ve got lives lost, and even if you were just to look at this as a financial play, the amount that we could seize would be far less than the damage China has caused. But the important thing for us is that we’ve got to deter future bad actors, because if the Chinese get away with this, then others will think that they can do the same thing.”

Chang warned, “This is probably not the last pandemic that comes from China.”

“What China did was deliberately make the world sick,” concluded Chang. “It’s hard to understand that, but … but Beijing took actions that would inevitably lead to other nations not protecting themselves, and that would mean the spread of this disease, infecting many, killing some. This is how malevolent Beijing has been. We have got to start defending ourselves, and one way to do this is to teach a lesson that Beijing will never forget.”

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