(This is my post about an NPR podcast on the USA's national debt (link). I edited it here, because I still can't say exactly what I want to the first time... can anyone?)
Thanks, Adam and David. Very clear and understandable, on an important modern topic.
In response to George's comment, though, I would like to offer a less confrontational perspective. Even as China grows stronger, it will not be a polarizing geopolitical force in the next ~50 years. The EU, Japan, India, and everyone else are still around to stabilize things. These countries are risk-averse with large populations that don't want another war.
Therefore, we should not willfully dream China into becoming a dangerous military threat, and should rather strengthen our economic, political, and cultural ties with China and these other powers that be.
However, The USA will face some large economic difficulties as our many creditors (not just from China) start borrowing less or even divest their dollar-based portfolios.
In terms of the USA's strategy to address these difficulties, I would choose diplomacy with more multilateral emphasis, coupled with the "Geo-Green" concept and tech-sector focus promoted by Thomas Friedman. (although he is unfortunately also prone to unproductive nation-state-war alarmism)
In agrarian societies, like the 1800s American Midwest, fat was sexy because it was a sign of health. These days, slim body types have become sexier because our modern health problems tend to come more from overeating than from hunger.
Likewise, Americans are realizing that hybrid sedans are sexier than Hummers, central heating is more hassle than convenience. Workers have a growing sense that borrowing a mortgage is a risky way to save income, given the fluid national job market and unstable real estate prices.
Patriots should express their nationalism by trying to buy USA-made products. That's why the new Prius factory in Blue Springs, MS is so important in pointing the way ahead for our recovering oligopolists from Detroit.
However, avoiding China-made products in particular isn't patriotic - this idea sounds rather more xenophobic.
To sum up, the short downturn following a phased-in carbon tax is far easier to handle than an explosion of our growing bubble of dollar debt. It will also speed our development of efficient products.
The high-volume business that the world wants from the USA, and will buy at premium price from the USA, is high-tech efficiency. High-tech reaches far beyond manufacturing, and depends on smart government investment. We need to take the long view and retool to provide our customers the efficiency they demand, and give our workforce the long-term jobs they deserve.