EIR LEAD EDITORIAL SUNDAY APRIL 9, 2023
The U.S. Must Be De-Dollarized
April 8, 2023, 2022 (EIRNS)—Over the recent period, and increasingly since Xi Jinping’s trip to Moscow, Western media have finally been caused to notice the motion underway globally away from the dollar—and the freakouts are beginning to roll. This process has undoubtedly sped up following Russia’s special military operation into Ukraine and the ensuing sanctions and other forms of financial warfare against Russia from Western governments. Now, as has been increasingly reported, trade in national currencies is on the rise, new lending institutions have been envisioned, and alternative currencies are being discussed. The dollar-denominated trans-Atlantic financial system is seen as unreliable and disingenuous, and can turn on you at any moment as a form of financial warfare.
The process this has unleashed is of profound historical significance, and is one that will not be stopped. Russian Foreign Minister Sergey Lavrov’s comments in Turkiye, that any peace deal in Ukraine must first take into consideration “what the principles of the new world order, which we all need, will be based on,” is illustrative.
The outrage of this type could be seen clearly last week in a vote at the UN Human Rights Council. A resolution was introduced to condemn the use of unilateral sanctions, which broadly punish and starve the poorest people where applied. Altogether 33 out of 47 nations voted in favor of the condemnation. Those opposed were of course the Western alliance, led by the U.K. and U.S., showing themselves to be absolute moral failures when it comes to issues of real “human rights” in all but the places where it fits their narrative. Eritrea’s representative to the UN ridiculed those nations that voted against the resolution, saying these are the countries “that give lip service to [a] rules-based international order [and] use unilateral sanctions [as] forms of warfare [to] bully and intimidate those nations that pursue independent national policies and programs to the benefit of their people.”
Further, the question of what it even means to be an “ally” of the Western rules-based-order crowd is raised in the case of Paraguay. The U.S. has recently been targeting Paraguay to not break with Taiwan in favor of China, as has been done by so many in Central and South America, most recently by Honduras. Apparently the way to treat your “allies” is to hound them and forcefully tell them who they can and cannot associate with. Or take the cases of Switzerland, Italy and Germany, which will soon be paid visits by members of the U.S. Treasury in order to be told the “penalties” of not following through on Western sanctions against Moscow.
Moves away from this failed, and flailing, system by Russia, China, the BRICS-Plus is justified in response. But it is not simply isolated to those countries—it is the Global Majority, it is an assertion from a growing number of peoples and nations across the world, that the old era of imperial geopolitics is over. As can be seen in the rapprochement between Iran and Saudi Arabia, and most recently in the hopeful potential for peace in the Yemen war, proper relations need not be premised on “rule by the stronger.”
Rather than be fearful or angry these developments, Western nations and the U.S. in particular should take proactive measures to protect itself: De-dollarize the U.S. Contrary to popular belief, the U.S. dollar is not actually a facet of the American economy, but rather is a creature of the Wall Street and City of London speculative monster following the 1971 takedown of Bretton Woods and creation of the petrodollar. The best thing the U.S. could do would be to free itself from this form of financial cancer, and restore a system of honest and legitimate economic activity. The way to do that now is to restore the Glass-Steagall Act, especially in light of the recent wave of bank failures.
If that were to be done, and the toxic waste of derivatives and other speculative financial instruments were thrown overboard, the trans-Atlantic economies would be freed up to engage in the much-needed development projects around the world. This is the real alternative to the failed rules-based-order, and its economic, political, and moral bankruptcy that is increasingly apparent.
As Lyndon LaRouche said repeatedly: Economics can never be based on money and markets, but only on real, physical processes. He told a Moscow press conference in 2001: “No new monetary system can function without a corresponding economic policy driver, long-term goals. All great movements of economic development have taken at least a quarter-century to realize. Now the greatest opportunity in the world today, for economic recovery of the world, lies in Eurasia.”
We are at the cusp of a new era, and the birth-pangs are growing increasingly uncomfortable. Don’t pull back! A passionate and dedicated minority is needed now to seize the moment and organize up a storm for a break from this failed and dying neoliberal system. The momentum is already there—join the fight to make it a reality.
Build for the Schiller Institute international conference on April 15-16.