China has spent the last decade eagerly helping America go into hock. Now, it's getting ready to buy up more productive assets in the United States.

The Chinese government says it will invest $3 billion in Blackstone Group, the big American private equity firm known for gobbling up underperforming companies. The investment is small, but it's a harbinger of things to come.

We can blame this mainly on American consumers' addiction to cheap imports and our predilection for spending rather than saving. The personal savings rate in the United States has been negative for two years. Meanwhile, our government prefers to borrow by the billions rather than raise taxes or cut spending. As a result, America runs on the buy-now, pay-later plan, and the Chinese are among our biggest creditors. If this trend continues, the long-term consequences will not be pleasant.

Last year, America imported $763 billion more in goods and services than it exported. Only about $232 billion of that trade deficit was with China. Washington has legitimate complaints about China's unfair trade and currency policies. But they're only part of a larger problem brought on by irresponsibility right at home.

Partly as a result of our huge trade deficit, the Chinese are sitting on $1.2 trillion in foreign currency reserves, the bulk of it in U.S. dollars. About $420 billion of that is held in U.S. Treasury bonds, meaning that the Chinese alone now hold 8.5 percent of our national debt. Other foreign holders of dollars are lending them back to us as well and buying up American assets. That helps explain why American interest rates have remained unusually low.

Tired of skimpy returns on their Treasury bonds, the Chinese now are planning an asset-buying spree both here and abroad. The investment in Blackstone is a step in that direction.

This entire trend is dangerous. The deeper in debt we go, the more vulnerable we will be to the whims of foreign creditors. Right now, they invest in U.S. debt and assets because they expect the greatest return here. Should they change their mind, the result could be higher interest rates in America, a slower economy and fewer jobs.

Our annual trade deficit now equals a frightening 7 percent of gross domestic product. That deficit represents a foreign claim on American labor and wealth. It will leave our nation poorer in the long run.

In theory, the trade deficit ought to be partly self-correcting. As dollars pile up abroad, their value should drop versus other currencies. Imports then would fall as they become more expensive for American consumers. American exports would rise as they become cheaper to foreigners. Socks might cost more at Wal-Mart, but more Americans would be working.

In fact, the dollar has fallen 27 percent against the Euro since 2002, partly for the reasons above. But the same hasn't happened in Asia, where China and other nations control their currencies to keep them cheap versus the dollar. Thus, America fills up with cheap Asian imports, and China fills up with American dollars.

The Bush administration has spent the past few years lobbying the Chinese to raise the value of their currency. The Chinese have given way grudgingly, letting their currency rise by about 8 percent against the dollar over the past two years. But it still is much below the value it would command on the free currency markets. President George W. Bush sent a shot across the bow earlier this year, bringing two unrelated unfair trade cases with the World Trade Organization. Democrats in Congress, meanwhile, are firing volleys with bills to hike tariffs on China.

America should keep up the pressure, while being careful not to set off a trade war. But even if China conceded, it would bring only partial relief for our trade woes. Faster world economic growth would help by lifting demand for American exports, but that's not something Washington can engineer.

The real solution is more responsibility and some old-fashioned frugality at home. Both the federal government and free-spending consumers need to pay closer attention to their checkbooks.