Our kids will pick up the check for our financial mess

Our kids ought to be hopping mad.

This whole financial crisis is essentially the consequence of bingeing on debt. And to get ourselves out of it, we are about to binge some more without showing the slightest inclination to pay for it.

The Bush administration's bailout plan for a financial crisis rooted in failing mortgages is pretty simple.

It asks Congress to increase the national debt ceiling to $11.315 trillion to cover $700 billion in new borrowings so the Treasury Department can buy bad loans.

"We're charging the national credit card. It's more of the same, just in larger numbers," said deficit hawk David Walker, president of the Peter G. Peterson Foundation.

President Bush called China's President Hu Jintao Monday morning to discuss all this - as well he might.

China holds more than $502 billion in U.S. treasuries.

Count the paper issued by Fannie Mae and Freddie Mac, along with debts bought in London's financial market that aren't identified in the official statistics, and China's holdings look more like $1 trillion to $1.3 trillion, estimates Brad Setser of the Council on Foreign Relations.

"That's enormous - close to 10 percent of our GDP," Mr. Setser said. "So China is understandably interested."

China's Xinhua news agency paraphrased Mr. Hu's views on the conversation this way:

"We have noticed that the United States has taken some important measures to stabilize the domestic financial market, and we hope these measures can achieve quick results so that economic and financial conditions in the United States will gradually improve and turn better."

Mr. Bush did not need to rattle the cup, but that's part of the underlying story here. We need Asian creditors to prop up the system.

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