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In April 2016, we considered the use of national debt as a weapon through Saudi Arabia’s threat to sell off its large holdings of the U.S. national debt and other assets. The threat comes in response to the possibility of the U.S. Congress acting to declassify 28 pages of a report about the role of foreign individuals and charities in funding the terrorists behind the September 11, 2001 attacks on the World Trade Center and Pentagon.
The following CNN report from September 8, 2014, discussed what is believed to be in those 28 pages, which the Obama administration is hiding from the American people despite President Obama’s promise to make them public.
President Obama responded to the call to finally make good on his promise to the families of 9/11 victims by threatening to veto the bill pending in Congress that would release these redacted pages of the report to the public. By all appearances, the administration is caving in to the Saudi government’s economic blackmail demands.
For now, it seems that the earliest the White House might release any part of the 28 pages would come in mid June. Since the administration has had years to address the issue, so to say that it has no sense of urgency in the matter would be a great understatement.
The U.S. Treasury Department has published data indicating that Saudi Arabia’s direct holdings of the U.S. national debt total $116.8 billion as of March 2016, which is approximately 0.6% of the U.S. government’s total public debt outstanding.
Saudi Arabia is also believed to have significant indirect holdings of U.S. debt securities, many of which our Treasury Department attributes to other nations, whose banks serve as intermediaries for the Saudis.
But if the Saudi’s total holdings are no more than $116.8 billion, the figure that represents its direct holdings, then it’s pretty remarkable to see just how much leverage against the U.S. president this amount appears to give the Saudis. One can only imagine what kind of accommodations the Chinese premier receives since China has lent the U.S. government over 12 times as much money as the Saudis have.
President Barack Obama greets Prince Faisal bin Bander bin Abdulaziz Al-Saud upon arrival at King Khalid International Airport in Riyadh, Saudi Arabia, April 20, 2016 (Official White House Photo by Pete Souza)