May 23, 2024
Greenback Warfare: The Treasury Department’s Approach to Global Economic Security
U.S. dollar dominance exists as an essential element of U.S. national power on par with more visible military and diplomatic tools. Architected at the end of World War II through the Bretton Woods system, the U.S. dollar’s global role for trade and finance underwrites sustained military expenditures, generous foreign assistance, and agenda setting within multilateral institutions. It allows the United States to borrow at favorable rates, import cheaper goods, and sustain economic sanctions.
Rumors about the demise of the U.S. dollar remain premature.
Despite its long history, the dollar’s preeminence and advantages face both international and, increasingly, domestic threats. Overseas, partners and adversaries continue to vie for an alternative currency or mechanism to move value at the scale, speed, and predictability of the U.S. dollar. Some international stakeholders lost confidence in the United States because of domestic shocks including the policy and regulatory failures that enabled the 2008 financial crisis and the unpredictability of the Trump administration. To many people overseas, the United States could no longer serve as a guaranteed bedrock of economic order and as a safe harbor for investments.
Whether these concerns are repairable or represent the beginning of an inescapable decline for U.S. economic power is at the center of Saleha Mohsin’s “Paper Soldiers: How the Weaponization of the Dollar Changed the World Order.” Chronicling four decades of U.S. economic leadership, Mohsin brings to life the often technical and dull world of financial markets in a thoroughly researched, accessible, and engaging narrative.
Read the full article from Lawfare.
More from CNAS
-
Economic Security in Asia Part 1: China's growing pains with Dan Rosen
Podcast
Dan Rosen, leading expert on China's economy and head of the Rhodium Group's China practice, joins Emily and Geoff to talk about the recently concluded third plenum meetings i...
By Emily Kilcrease & Geoffrey Gertz
-
What a Bunch of Malarkey!
Podcast
Emily and Geoff discuss the U.S. presidential election and what that might mean for economic security policy. They get into trade policy, what both candidates would do to comp...
By Emily Kilcrease & Geoffrey Gertz
-
How U.S.-China Competition Upended the International Economic Order and What the United States Can Do to Fix It
Podcast
On June 26, CNAS hosted an event to discuss a new report, Disorderly Conduct: How U.S.-China Competition Upended the International Economic Order and What the United States Ca...
By Emily Kilcrease, Geoffrey Gertz, Adam Tong & Peter Harrell
-
Sanctions by the Numbers: 2023 Year in Review
Reports
Executive Summary In 2023, the Biden administration continued to prioritize sanctions as a key tool to support U.S. national security and foreign policy objectives. The United...
By Rowan Scarpino & Jocelyn Trainer
