Re: [A-List] Rep Ron Paul (R-TX) Speech: The End of Dollar Hegemony

["Henry C.K. Liu" <hliu@xxxxxxxxxxxxxx>]

Do a Google search on the term Dollar Hegemony and see whose name come
up most. As for Michael book, its a very good book. But the term dollar
hegemony deos not appear in it. I helped to convince his publisher to
publish a new edition in 2003 and helped edit Michael's new preface for
it. Michael and I are close friends and see eye to eye on many
subjects.  If you ask Michael directly he will acknowledge that the
specific term dollar hegemony to summarize the role of the dollar under
neo-liberal finance globalization first appeared in print in my 2002
Asia Times article and on the Internet some years before as early as
1998 in my posting to several lists.  Gary Santos knows that as we had a
public exchange on some list before and he told me that "it is a feature
in your hat" for having coined the term, or some words to that effect,
which was not the way I was thinking about it.  Many people contributed
to public awarness of emreging trends and I no doubt benefited from
exchange swith Michael after I was invited to join Gang8. Michael
introduced me to Ann Willaimson and the three of us talked over dinner
once at my house from 8 pm to the following morning non stop on many
subjects.  But as a matter of record, the term dollar currency, which
appeared to have gain some currency, first was coined by me in 2002, for
which I gave a very clear definition:

World trade is now a game in which the US produces dollars and the rest
of the world produces things that dollars can buy. The world's
interlinked economies no longer trade to capture a comparative
advantage; they compete in exports to capture needed dollars to service
dollar-denominated foreign debts and to accumulate dollar reserves to
sustain the exchange value of their domestic currencies. To prevent
speculative and manipulative attacks on their currencies, the world's
central banks must acquire and hold dollar reserves in corresponding
amounts to their currencies in circulation. The higher the market
pressure to devalue a particular currency, the more dollar reserves its
central bank must hold. This creates a built-in support for a strong
dollar that in turn forces the world's central banks to acquire and hold
more dollar reserves, making it stronger. This phenomenon is known as
dollar hegemony, which is created by the geopolitically constructed
peculiarity that critical commodities, most notably oil, are denominated
in dollars. Everyone accepts dollars because dollars can buy oil. The
recycling of petro-dollars is the price the US has extracted from
oil-producing countries for US tolerance of the oil-exporting cartel
since 1973.

Henry C.K. Liu


Gary Santos wrote:

> I would like to add that Prof. Michael Hudson, Univ of MI, who wrote a paper
> in the circa 1971/1972 on post 1971 US balance of payments should be
> credited with the concept of dollar hegemony. My understanding is that the
> paper is available in the NYU Business library. The term he prefers for the
> phenomenon is the "US Treasury Bill Standard" (as in monetary standard). He
> followed up with a book, Super Imperialsim, published in 1972 which,
> two/three years ago, is on its second edition.
>
> http://michael-hudson.com/
>
> ----- Original Message -----
> From: "Henry C.K. Liu" <hliu@xxxxxxxxxxxxxx>
> To: "The A-List" <a-list@xxxxxxxxxxxxxxxxxxx>
> Sent: Saturday, February 18, 2006 11:55 PM
> Subject: Re: [A-List] Rep Ron Paul (R-TX) Speech: The End of Dollar Hegemony
>
>
>
>
> > When I first used the term on several discussion lists, I was rebuffed
> > by many American economists as being anti-US. I officially coined the
> > term "dollar hegemony" in 2002 on the Internet with an article: US
> > Dollar Hegemony has got to go.
> > http://www.atimes.com/global-econ/DD11Dj01.html
> >
> > The term now is widely used and its gratifying to see that it has
> > finally made it onto the floor of Congress.
> >
> > Henry C.K. Liu