More testimony? Yes, more testimony.

There was no blogging yesterday because I was in Washington testifying again — this time at the House Financial Services Subcommittee on Domestic and International Monetary Policy, Trade and Technology.  If you click on the link above, you can access my written testimony, or check out the video, which I think proves beyond a shadow ...

There was no blogging yesterday because I was in Washington testifying again -- this time at the House Financial Services Subcommittee on Domestic and International Monetary Policy, Trade and Technology.  If you click on the link above, you can access my written testimony, or check out the video, which I think proves beyond a shadow of a doubt that even if fellow witnesses Brad Setser and Edwin Truman are way smarter than me, I'm the better dresser.  Patrick Yoest of the Wall Street Journal's Real-Time Economics blog provides a partial summary (the comments to his post are worth a read for entertainment value alone).  Apparently I said something newsworthy:  Daniel W. Drezner, a professor of international politics at the Fletcher School of Law and Diplomacy at Tufts University, compared the growing role of sovereign wealth funds and foreign investment in the U.S. to the idea of “mutually-assured destruction” between the U.S. and the Soviet Union during the Cold War. “Mutually-assured destruction can mean a more peaceful co-existence, but it’s a relatively nervous co-existence,” Drezner said. Drezner added that while interdependence caused by greater foreign investment in U.S. firms “will constrain U.S. foreign policy,” he said foreign holders of U.S. debt would be unlikely to take drastic actions to hurt the U.S. “They can’t see all of their assets wipe away with the blink of an eye,” Drezner said. “They would be equally devastated.” One last note -- it's a very strange world we live in when former Fed official Edwin Truman says he agrees with 75% of what renking member Ron Paul says about international monetary policy.

There was no blogging yesterday because I was in Washington testifying again — this time at the House Financial Services Subcommittee on Domestic and International Monetary Policy, Trade and Technology.  If you click on the link above, you can access my written testimony, or check out the video, which I think proves beyond a shadow of a doubt that even if fellow witnesses Brad Setser and Edwin Truman are way smarter than me, I’m the better dresser.  Patrick Yoest of the Wall Street Journal‘s Real-Time Economics blog provides a partial summary (the comments to his post are worth a read for entertainment value alone).  Apparently I said something newsworthy: 

Daniel W. Drezner, a professor of international politics at the Fletcher School of Law and Diplomacy at Tufts University, compared the growing role of sovereign wealth funds and foreign investment in the U.S. to the idea of “mutually-assured destruction” between the U.S. and the Soviet Union during the Cold War. “Mutually-assured destruction can mean a more peaceful co-existence, but it’s a relatively nervous co-existence,” Drezner said. Drezner added that while interdependence caused by greater foreign investment in U.S. firms “will constrain U.S. foreign policy,” he said foreign holders of U.S. debt would be unlikely to take drastic actions to hurt the U.S. “They can’t see all of their assets wipe away with the blink of an eye,” Drezner said. “They would be equally devastated.”

One last note — it’s a very strange world we live in when former Fed official Edwin Truman says he agrees with 75% of what renking member Ron Paul says about international monetary policy.

Daniel W. Drezner is a professor of international politics at Tufts University’s Fletcher School. He blogged regularly for Foreign Policy from 2009 to 2014. Twitter: @dandrezner

More from Foreign Policy

A worker cuts the nose off the last Ukraine's Tupolev-22M3, the Soviet-made strategic aircraft able to carry nuclear weapons at a military base in Poltava, Ukraine on Jan. 27, 2006. A total of 60 aircraft were destroyed  according to the USA-Ukrainian disarmament agreement.
A worker cuts the nose off the last Ukraine's Tupolev-22M3, the Soviet-made strategic aircraft able to carry nuclear weapons at a military base in Poltava, Ukraine on Jan. 27, 2006. A total of 60 aircraft were destroyed according to the USA-Ukrainian disarmament agreement.

Why Do People Hate Realism So Much?

The school of thought doesn’t explain everything—but its proponents foresaw the potential for conflict over Ukraine long before it erupted.

Employees watch a cargo ship at a port in China, which is experiencing an economic downturn.
Employees watch a cargo ship at a port in China, which is experiencing an economic downturn.

China’s Crisis of Confidence

What if, instead of being a competitor, China can no longer afford to compete at all?

Federal Reserve Chair Jerome Powell testifies in the U.S. Senate in Washington on Sept. 24, 2020.
Federal Reserve Chair Jerome Powell testifies in the U.S. Senate in Washington on Sept. 24, 2020.

Why This Global Economic Crisis Is Different

This is the first time since World War II that there may be no cooperative way out.

Chinese President Xi Jinping (left) and Premier Li Keqiang applaud at the closing session of the National People's Congress at the Great Hall of the People in Beijing on March 11.
Chinese President Xi Jinping (left) and Premier Li Keqiang applaud at the closing session of the National People's Congress at the Great Hall of the People in Beijing on March 11.

China Is Hardening Itself for Economic War

Beijing is trying to close economic vulnerabilities out of fear of U.S. containment.