China's commentary which came after credit rating agency Standard & Poor downgraded U.S credit rating from a top-notch AAA to AA+, harshly criticized U.S for its "debt-addiction" and short-sightedness of politicians.
"China, the largest creditor of the world's sole superpower, has every right now to demand the United States address its structural debt problems and ensure the safety of China's dollar assets," Reuters reported quoting China's official Xinhua news agency. "The US government has to come to terms with the painful fact that the good old days when it could just borrow its way out of messes of its own making are finally gone.
China slammed the first ever credit downgrade in U.S. history saying that U.S lacks "common sense" and it is high time the government cut military and social welfare expenditure.
"International supervision over the issue of U.S. dollars should be introduced and a new, stable and secured global reserve currency may also be an option to avert a catastrophe caused by any single country," Xinhua said.
British business minister Vince Cable supported China's call for a new stable global reserve currency but said that for the moment the U.S. dollar remained key.
S&P, one of the world's leading credit rating agencies, has admitted to have made a mistake in the range of $2 trillion while calculating deficits, immediately after U.S. treasury officials pointed out the same, but strangely chose to stick to the credit downgrade.
In its rationale for lowering the credit rating, S&P cited a "prolonged" political fight to raise the debt ceiling and "containing the growth in public spending, especially on entitlements, or on reaching an agreement on raising revenues."
S&P said it was "pessimistic" that the recent agreement could lead to a broader fiscal consolidation plan that would stabilize the government's debt dynamics "any time soon."
France still enjoys AAA rating even though it has a much higher debt per capita ratio than the U.S, while Japan's credit rating was downgraded several years ago, when the interest rates its government paid on bonds was already extremely low, and they've generally trended lower in the years since, says columnist Daniel Gross in his article.