All posts tagged: petrodollar

Oil, Agriculture and Imperialism: Averting the Fast-Track to Armageddon?

US global hegemony depends on Washington maintaining the dollar’s leading role. Engaging in petrodollar recycling and treasury-bond ‘super-imperialism’ are joined at the hip and have enabled the US to run up a huge balance of payments deficit (a free ride courtesy of the rest of the world) by using the (oil-backed) paper dollar as security in itself.

‘Exorbitant Privilege’ Under Siege

Frank Lee It was the French politician Valery Giscard D’Estaing who first coined the phrase ‘Exorbitant Privilege’ – a reference to the many advantages enjoyed by the US ownership and control of the world’s reserve currency. This was a situation dating back to the agreement reached in 1944 between the allied powers and established in Bretton Woods a town in New Hampshire; it was to become known as the Bretton Woods Agreement. During the conference key negotiators, most famously John Maynard Keynes for Britain, and Harry Dexter White chief US delegate, hammered out a blueprint for a new global and currency and trading system. Keynes was not entirely satisfied with the outcome and White mostly got his own way despite JMK’s misgivings about possible problems further down the road. But then the UK in the shape of Keynes, was also angling for a sizeable US loan in the not too distant future which circumscribed Keynes’ room for manoeuvre; and the loan of course came with strings – viz., the ending of British imperial preferential trading …