If you missed my piece from yesterday, I’d just like to highlight and appreciate the Vice President’s consistent support of a very bad idea. Here he is from 2023 arguing that because we are the reserve currency of the world, we export dollars, but not much else. In fact, he says we cannot build enough weapons domestically because of the reserve currency.
If you dwell online, like the Vice President, you might be convinced we have wiped out our export base, etc. But the actual facts do not back that up.
US exports are ten times higher than they were fifty years ago.
Our GDP is now fully 25% of the world’s GDP, including being larger than China’s.
With our trade deficits, we actually built an industrial powerhouse instead of a welfare state.
And because of our role as the reserve currency, we’ve seen $7 trillion in foreign investment into the United States, which has led to $28,000 more a year in family income over the last forty years.
You end the reserve currency, product costs go up, and standards of living go down.
As President Trump has rightly noted, if the United States loses its status as the world’s reserve currency, we’ll become a third world country.
Democrats decided to try to introduce us to Modern Monetary Theory and set off massive inflation. Now, the Vice President would turn us into a third world economy.
The thing that is actually the most irksome about all of this is not that the Vice President keeps showing himself to be a hyper-online conspiracist, but the throne sniffers of the right who are suddenly defending and supporting ending the United States as the world’s reserve currency.
One must wonder how long the Heritage Foundation will defend our reserve currency now that JD Vance has come out against it. From 2015 at the Heritage Foundation:
“It was Charles de Gaulle who first complained publicly about the power of America’s reserve currency. It is now the BRICS countries who are trying to reform the international monetary system to “dethrone” the dollar. The benefits of an international reserve currency include:
Seigniorage—the difference between the face value of money and its production cost. It is perhaps the least understood advantage, but one that provides the largest monetary gain. It currently costs 12.5 cents to print a $100 bill. That bill, however, can be used to purchase real goods and services worth $100 in the market. What this means at the policy level is that the Federal Reserve can essentially print money to buy real assets, as it has done with its quantitative easing policies.
Low interest rates. The reserve-currency countries have the ability to run up fiscal debts denominated in their own currency at relatively low interest rates.
Convenience. It is more convenient for a country’s exporters, importers, borrowers, and lenders to be able to deal in the country’s own currency than in foreign currencies. Doing so reduces transaction costs as well as foreign exchange risk.
More business for banks and other financial institutions. It stands to reason that U.S. banks have a comparative advantage in dealing in dollars, and Chinese banks in dealing with RMB.
Political power and prestige. Britain’s gradual loss of reserve currency status coincided with its gradual loss of political and military preeminence.”
We now live in a nation where a mom and dad cannot run into a drugstore and buy their children Sudafed over the counter for congestion because Congress decided we must all be inconvenienced lest a methhead buy it all to make meth. Never mind that virtually every study ever done showed the methheads were not running into CVS to get their pseudoephedrine supplies.
Now, JD Vance and the post-liberal right think we need to be consigned to a third world economic status because Congress is addicted to spending. If Vance and post-liberal right would demand Congress exercise spending discipline, instead of conflating that to the reserve currency status of the nation, the problem would take care of itself.
But Vance and the post-liberals want a technocracy of post-liberals to run the country, set industrial policy, and decide for you and your family what your common good must be. Disvesting power from Washington and reducing spending is not actually on the table.
They’d apparently rather us turn into a third-world country.
Y’all, I totally understand the people who think the nation is in decline. There is absolutely social decay. But there was in the 1970’s. Henry Kissinger, Jimmy Carter, and the establishment of both parties wanted to manage that decline in world divided by spheres of influence. Ronald Reagan came along and turned it all on its head and decided we would not keep declining, but would reverse, rise, grow, and lead.
Now, the doomers on the right who believe it is their patriotic duty to announce our decline want to embrace the policies that would accelerate that decline. We need a politician who can choose to defy the decline. These people have given up on the greatness of America because they think our people are not great. And the common thread is they spend their days on Twitter, where the demons control the algorithm and drive the mind to hate.
Again, it must be noted that Vance is aligned with the Democratic Socialists of America, the Chinese Communist Party, and the Russian government on this issue. All of them object to the United States as the world’s reserve currency.
I have a lot of issues with Trump. I usually don't agree with his tactics.
But, one thing I have not done is thought he believed America should decline in status around the world.
Why he continues to support Vance as his successor is beyond me. Vance: The Joe Biden of the GOP. As Robert Gates said about Biden, "He's been wrong on every issue".
Even more confusing why Trump supports him is that Trump has a superstar in his administration that would likely win the next two presidential elections.
Maybe it's a good thing VP Vance is showing his colors now. Rubio is the true statesman we need.