THE NEW WORLD DISORDER
Goodbye U.S. dollar,
hello global currency
By Jerome R. Corsi
The Director of International
Economics at the Council on Foreign Relations has launched a scathing
attack on sovereignty and national currencies.
Benn Steil, writing in the current issue of CFR's influential
Foreign Affairs magazine, says "the world needs to abandon unwanted
currencies, replacing them with dollars, euros, and multinational
currencies as yet unborn."
In the article, "The End of National Currency," Steil clearly
asserts the dollar and the euro are temporary currencies, perhaps
necessary today. He argues "economic development outside the process
of globalization is no longer possible."
His inevitable conclusion is "countries should abandon monetary
nationalism."
Steil tempers his embrace of one world currency, writing,
"Governments should replace national currencies with the dollar or the
euro or, in the case of Asia, collaborate to produce a new
multinational currency over a comparably large and economically
diversified area."
He concludes: "It is the market that made the dollar into global
money - and what the market giveth, the market can taketh away. If the
tailors balk and the dollar falls, the market may privatize money on
its own."
The "tailors" Steil has in mind are the world's central bankers. He
advises that the U.S. needs "to perpetuate the sound money policies of
former Federal Reserve Chairmen Paul Volker and Alan Greenspan, and
return to long-term fiscal discipline." In our current era of large
and growing trade imbalances, and over $35 trillion in GAAP (Generally
Accepted Accounting Principles) accounted federal deficits, these
targets appear unlikely.
Steil concludes "the foreign tailors, with their massive and
growing holdings of dollar debt," no longer feel "wealthy and secure"
in the economic environment of a resultant falling dollar. The
inevitable conclusion is that the dollar, too, may be on the way out.
Steil's essay is antagonistic to the ideas of sovereignty and
national currencies. He writes, "The right course is not to return to
a mythical past of monetary sovereignty, with governments controlling
local interest and exchange rates in blissful ignorance of the rest of
the world. Governments must let go of the fatal notion that nationhood
requires them to make and control the money used in their territory."
Steil has ultimate confidence that economic globalism is
irreversible, with national currencies doomed to the dustbin of
history.
"In order to globalize safely," he advises, "countries should
abandon monetary nationalism and abolish unwanted currencies, the
source of much of today's instability."
Steil believes continued economic growth demands a global flow of
capital unimpeded by the barriers inherent to "monetary nationalism."
He asserts barriers created by monetary nationalism, such as national
exchange rates or national monetary policy regimes, inevitably impede
capital flow and cause currency crises as a consequence.
Steil fundamentally argues, "Monetary nationalism is simply
incompatible with globalism."
Since Steil believes that only globalism offers the unrestrained
flow of capital needed for worldwide economic development, he contends
even re-establishing a gold standard would be counter-productive, when
the only real solution is to abandon the idea that nations have any
reason to create currencies at all.
Throughout his analysis, Steil cautions that dependence upon the
dollar, or the euro, as global currencies, is not fundamental to his
argument.
He stresses that "the dollar's privileged status as today's global
money is not heaven-bestowed. The dollar is ultimately just another
money supported only by faith that others will willingly accept it in
the future, in return for the same sort of valuable things it bought in
the past."
In other words, if the institutions of the U.S. government fail to
validate that faith, the dollar, too, merits being abandoned.
"Reckless U.S. fiscal policy is undermining the dollar's position
even as the currency's role as a global money is expanding," he notes.
Steil imagines the ultimate solution is to privatize a global
currency through a gold-based international monetary system.
"A new gold-based international monetary system surely sounds
far-fetched," he concludes. "But so, in 1900, did a monetary system
without gold. Modern technology makes a revival of gold money, through
private gold banks, possible even without government support."
WorldNetDaily previously reported Steve Previs, a Vice
President at Jeffries International Ltd., in London, told CNBC
Nov. 27, 2006, the amero "is the proposed new currency for the North
American Community which is being developed right now between Canada,
the U.S., and Mexico."
WorldNetDaily also has reported a continued slide in the
value of the dollar on world currency markets could set up conditions
in which the adoption of the amero as a North American currency gains
momentum.
The amero was first proposed as a North American unitary currency
by Canadian economist Herbert G. Grubel of the Fraser Institute in
Vancouver, British Columbia.
In a publication entitled "The Case for the Amero," Grubel argued
that a North American monetary union would eliminate the costs of
currency trading and risk, furthering the development of a North
American common market along the model of the European Common Market.
Robert Pastor, director of the Center for North American Studies at
American University, supported Grubel's arguments for the amero.
In his 2001 book entitled Toward a North American Community, Pastor
supported Grubel's suggestion that the creation of the amero would be
accompanied by the creation of a Central Bank of North America,
similar to the European Central Bank.
Grubel's argument on the amero has also been published as a book in
Spanish, entitled El Amero: Una Moneda Comun para Améica del Norte,
published by CIDAC (Centro de Investigación para el Desarrollo), the
Center for Research for Development in Mexico.
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