US military paid for by foreign debt?

In a new Japan Focus article, R. Taggart Murphy* discusses why Japan has not (will not) internationalized the yen.

He also makes the following observation:

...Japan has left its export earnings inside the U.S. banking system, thereby automatically helping to finance American external deficits. Thus Japan has been the primary financial facilitator since the 1970s of the American ability to project military power around the world without crushing domestic tax burdens. While it has been joined in the last decade by China and the petroleum exporters, it is safe to say that the end of Japan’s support for the dollar would mark the end of the American ability to run endless current account deficits and thus its ability to support its vast military establishment...

And we are in paranoid mode about security when we have to borrow from foreign countries to pay for much of our ability to project military power? At least one of our lenders (China) is considered by some to be a potential military opponent. How is that secure?

And since the US values military security over economic security,** this may also help explain a lot in US/Japan relations.

*Murphy has written good two excellent books about Japan's 1989-early 2000s economic problems, including Japan's real estate bubble and the Japanese government's involvement in creating and bursting the bubble: Japan's Policy Trap and The Weight of the Yen.

**This sort of thinking has been criticized since at least the 1980s and the US/Japan trade friction. It can be convincingly argued that the US contributed to peace after WW2 with economic policy much more than military power, although both were important during the Cold War. See Asia, America, and the Transformation of Geopolitics, for example.