Borrowing From Peter To Pay… Peter?

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China, the largest holder of U.S. Treasury bonds (with $1.1 trillion as of March), received $27.2 million in aid during fiscal year 2010.

The United States provides hundreds of millions of dollars in foreign aid to the very countries it borrows billions of dollars from, according to a report by the Congressional Research Service.

The report, which focuses only on countries to which the U.S. owes $10 billion or more, provides data for fiscal year 2010 and includes a chart where “countries are ordered by the value of their treasury security holdings, with the highest value holder, China, listed first.”

According to the report, China received $27.2 million from the U.S. in fiscal year 2010. According to the Treasury Department, the U.S. owes China $1.1 trillion, as of March.

The report lists funds by their earmarks, the names of which vary from the specific (Combating Weapons of Mass Destruction, Counter-Narcotics, HIV/AIDS) to the vague (Good Governance, Civil Society, Unspecified Development Assistance).

Senator Tom Coburn (R-Okla.), who requested the report, was disturbed by its findings, according to a statement quoted by FoxNews.com.

“Borrowing money from countries who receive our aid is dangerous for both the donor and recipient. If countries can afford to buy our debt, perhaps they can afford to fund assistance programs on their own,” Coburn’s statement read.

“At the same time, when we borrow from countries we are supposedly helping to develop, we put off hard budget choices here at home. The status quo creates co-dependency and financial risk at home and abroad.”

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