Advice To Tokyo About That US Debt Weapon: Use At Your Own Risk

Latest stories

Watching the Kremlin's new Putin documentary so you don't have to Whole world loses if India-Pakistan go to war US wobbles ahead of China trade talks in Geneva

The usual scenario is China (which holds around $800 billion in US debt) dumping its T-bills on the market to hurt the Americans. But few people envisaged Japan initiating a chain reaction that leaves the US fiscally and morally incapable of responding to a Chinese attack on Taiwan , the Philippines and/or Japan itself.

The Japanese destroyer Kaga (center) with American and French aircraft carriers sail alongside each other in waters east of the Philippines on February 12, 2025. Photo: Japan Maritime Self-Defense Force

Weaponize debt, and the US-Japan alliance will end. Americans in large parts of the country will view the Treasury's sell-off as treachery.

Moreover, if Japan pulls the debt trigger, it will be collaborating with China to undermine US preeminence. This could weaken America's ability to sustain the military presence that has maintained an equilibrium in the Far East and protected Japan.

Japan ought to view its actions not in terms of trade negotiations. Instead, as one observer puts it:“What Japanese missteps will fill the Panda with glee and excite the dragon's appetite for conquest? China is an active corrosive agent. Why would Japan wish to become an accelerant or a collaborator in its own demise?”

Misreading the American mood

One gets the impression that Japanese officials and their political class have too narrow an understanding of America and Americans. Their view is largely shaped by the diplomats, think-tankers, academics and lobbyists they brush elbows with in Washington.

Japan does not grasp how large swaths of the US have little trust in the government and little interest in foreign wars.

Warren Buffett presiding at the 2023 Berkshire Hathaway meeting on May 6. Photo: screenshot

During the recent Berkshire Hathaway annual shareholders meeting, Warren Buffett made specific comments on Japan, business opportunities, and tariffs. He made a“free trade” comment, basically supporting the deportation of US jobs, which was received with hearty applause.

That response shows not the divide, but the chasm between the investor class and middle America, so-called flyover country. Hint to the Japanese who were tuned in: the US investor class is not the US warrior class. The wealthiest top 10% of Americans own 88% of equities. In contrast, the next 40% hold the remaining 12% .

As for the bottom 50%, they don't own stocks - they own debt. That's also where the military recruiting offices are concentrated.

The smug elite can no longer claim that the peasant class will simply go where they're dispatched.

No more playing 'attending physician'

After the Afghanistan debacle – 20 years of body counts, expended national wealth and lost opportunity costs – Americans have adopted a post-World War I attitude toward the world. There's growing hostility toward the globalists and neocons.

Many are just waiting for the wrong person to throw patriotism in their faces. Especially after the Joe Biden years of burning flags and the era of toppling statues.