“We hate you guys,” Luo Ping, a director-general at the China Banking Regulatory Commission (CBRC), complained last week on a visit to New York. “Once you start issuing $1-$2 trillion … we know the dollar is going to depreciate, so we hate you guys, but there is nothing much we can do.”

Of course, official Chinese  newspapers the next day said Luo was just kidding.

Geoff Dyer recently wrote a lengthy analysis and commentary on the addictive relationship China and the United States have developed between each other vis a vis where and how China invests its foreign reserves. Problem is, the Chinese are not happy about the rates of return they are getting from investing in T-bills:

“China’s near $2,000bn (£1,380bn, €1,560bn) in reserves, the world’s largest, are often viewed outside the country as a great strength – an insurance policy against economic turbulence. But within China, they are increasingly seen by the public and even some policymakers as something of an albatross – a huge pool of resources not being used at home that will plunge in value if the US dollar collapses. Why, people ask, should such a relatively poor country bankroll such a rich one?”

It’s a very good question, indeed. Of course, the Chinese government was looking to sock its earnings away for a rainy day, as is the Asian habit. But, effectively, they built a house – in rather a hurry, I might add – without first building a floor. Or rather, the “floor” is more like a series of bamboo poles criss-crossing a very big, deep hole where a foundation should actually have been seeded.

That is, instead of re-investing all those hard-earned yuan back into their own society, they tucked their winnings in the only currency considered sturdy enough to serve as a reserve currency: the almighty dollah. Likely, if gold was still THE standard, they’d be investing in gold instead. The result, then, is a country that despite break-neck economic development since 1999 has little to no social safety net, a growing disparity between poor and rich that has surpassed even the USA’s greedy gap, very little infrastructure in its vast interior and an accelerating number of unemployed – both educated and uneducated.

It’s been clear the last eight years in particular that despite productivity gains in industry the average Chinese worker has seen little of it pass to his pocket – oddly, much like average American’s pocket since the early 1970s. The American middle class, though, turned to easy credit as a fix, to plug the hole in their unmet expectations for a better life. The Chinese, though, haven’t even that chimera of debt; instead, many find their lives economically unreeling into the past more quickly than it seemed to have sped forward.

Clearly, now, it’s time for the pusher to stop pushing and for the addict to clean up its act. Neither government policy quite frankly looks that great when viewed through the prism of the disappointment and even desperation of the majority of people in both countries.

It’s time for both countries to stop pointing fingers and to give their citizens sound, stable floors based in solid economic and humanitarian fundamentals so people in both societies can actually realize AND keep the good lives their grandparents worked so hard for their descendants to realize.