Is the U.S. dollar dead?

Image by AFP/Getty Images via Daylife

It had to happen eventually.  A bunch of countries have gotten together to say that the dollar will no longer be the standard of exchange in oil markets. According to a story in The Independent,

In the most profound financial change in recent Middle East history, Gulf Arabs are planning – along with China, Russia, Japan and France – to end dollar dealings for oil, moving instead to a basket of currencies including the Japanese yen and Chinese yuan, the euro, gold and a new, unified currency planned for nations in the Gulf Co-operation Council, including Saudi Arabia, Abu Dhabi, Kuwait and Qatar.

Secret meetings have already been held by finance ministers and central bank governors in Russia, China, Japan and Brazil to work on the scheme, which will mean that oil will no longer be priced in dollars.

Gold prices are going up. And in 9 years, in 2018, the dollar, which has dominated the global reserve currency, will be replaced by a “basket of currencies.”

Secret Plan to Ditch the U.S. Dollar’s Dominance Uncovered | World | AlterNet.

According to a follow-up article in Sky News, the dollar’s demise, like Mark Twain’s, might have been great exaggerated since Saudi Arabia’s central bank quickly denied it. ‘Dollar Is Dead’ Report Triggers Gold Surge (news.sky.com)

Whether true or not, the dollar slipped in value, oil is rising as a result, and it is all fairly symbolic of the end of American Empire.  Here’s the really sad thing, though: while American Empire and the dollar are both dying- whether now or nine years from now or 3 years ago- the US tries to control the world with military might.

This was the Bush Plan, the plan of Project for a New American Century, and the wishes of a dying generation of Neocons who really and truly believed the US could be in horrible economic shape, but as long as it had the biggest military in the world, we would be able  to dominate the world.

But the death of the dollar should serve as a wake up call that the US cannot maintain its influence in the world through military might alone.  And the endless wars in Afghanistan and Iraq have weakened us by draining much needed resources out of the country, killing and maiming an entire generation of soldiers, and creating a debt level that is unconscionable in the best of economic times.

But the wars, unlike health care, are never discussed as economic issues.  Instead, patriotism and nationalism make discussing the actual cost of war like talking about the cost of a wedding (was it really worth it?) or a child (how many hundreds of thousands of dollars will be spent from birth to college?).  These “sacred” undertakings- killing, mating, and reproduction- are not to be reduced to dollars.

And anyway, now the dollar is dead.  May it rest in peace.