The Roadblock

In: FP, Issue 203

Abstract

A growing number of developing-country officials are increasingly worn ed that 'irresponsible' political behavior in the US risks undermining the well-being of their citizens. Indeed, the 16-day government shutdown this October and the congressional brinkmanship over the debt ceiling that threatened a payments default are just two points in a seemingly endless series of strange developments that risk fueling unnecessary financial and economic instability in the rest of the world. Being on the receiving end of Western-induced economic disruptions is not a new phenomenon for developing countries. Fortunately, and to the surprise of many, emerging economies bounced back from the global financial crisis much better -- and much faster -- than most analysis had predicted. Developing countries are powerless to rewire the system quickly, especially as there is no other economic and financial superpower to replace the US at the core. No wonder China expressed annoyance at US congressional behavior. particularly as it threatened the est mated $1.3 trillion Beijing holds in bonds issued by the US government. Adapted from the source document.