Odd Lots Here’s Who Really Benefits From The Dominance Of The U.S. Dollar
May 28, 2020
Yakov Feygin, Assistant Director of the Future of Capitalism project at the Berggruen Institute, delves into the complexities of the U.S. dollar's global dominance. He discusses how this supremacy benefits economic elites while hurting many U.S. workers, particularly in manufacturing. The conversation highlights systemic inequalities, the challenges posed by dollar-denominated debt in emerging markets, and concepts like 'Dutch disease.' Feygin also offers insights into potential reforms for better currency stability and wealth distribution.
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Class Politics of the Dollar
- The dollar system benefits elites in the U.S. and capital-owning elites, especially in developing countries.
- It hurts workers by encouraging rent-seeking behavior and enabling corruption, suppressing democracy.
Dollar Dominance and Trade
- The dollar's dominance contributes to a U.S. trade deficit and impacts the labor market by increasing the value of non-tradable goods.
- This disproportionately affects average households and can lead to economic bifurcation.
U.S. 'Dutch Disease'
- Dutch disease, typically seen in commodity-exporting countries, can also apply to the U.S.
- The U.S. exports debt and currency, leading to a similar dynamic of rent-seeking elites and a bifurcated economy.
