‘Catastrophic’: Biden’s Policies Put US Dollar’s Global Dominance At Risk,

• The policies of President Joe Biden’s administration are undermining the strength of the U.S. dollar and jeopardizing America’s worldwide influence, economists told the Daily Caller News Foundation. 
• Economists expressed concern regarding the possible consequences of Biden’s policies, highlighting the threat to the U.S. dollar’s global reserve currency status. 
• “Losing reserve currency status … would mean 70 years of deficits flooding back to the U.S., all competing with existing dollars held domestically to buy goods and services,” Heritage Foundation economist E.J. Antoni told the DCNF. “That’s a hyperinflation scenario. It also means we could no longer export inflation abroad, so we’d bear the full cost of future inflation ourselves.”

President Joe Biden’s administration’s policies are weakening the standing of the U.S. dollar and threatening America’s global influence, according to economists who spoke to the Daily Caller News Foundation.

Economists told the DCNF about the potential repercussions of Biden’s policies, expressing serious concerns that the U.S. dollar’s global reserve currency status is at risk. The result could be hyperinflation, spending cuts and other severe consequences for the country; economists concurred that the actions taken by the Biden administration and the Federal Reserve have contributed to the depreciation of the U.S. dollar, but there was a divergence of opinion regarding the extent of the risk.

“The Biden administration has taken so many actions to dethrone King Dollar that it would be difficult to rank them all by their destructiveness,” Heritage Foundation economist E.J. Antoni told the DCNF.

As the reserve currency, the U.S. dollar is involved in the majority of business on the planet. International trade typically takes place in dollars.

“Losing reserve currency status … would mean 70 years of deficits flooding back to the U.S., all competing with existing dollars held domestically to buy goods and services,” Antoni told the DCNF. “That’s a hyperinflation scenario. It also means we could no longer export inflation abroad, so we’d bear the full cost of future inflation ourselves.”

Economists particularly criticized the Biden administration’s sanctions against Russia as a punishment for invading Ukraine. The U.S. seized Russian central bank assets and participated in banning Russian banks from the Society for Worldwide Interbank Financial Telecommunication (SWIFT), the global financial messaging system, in February 2022.

The U.S. and its allies have taken over $300 billion worth of foreign currency assets held by the Russian central bank, which had been frozen due to sanctions, according to Reuters. A substantial portion of the seized assets are now located at the Federal Reserve Bank of New York, although they are still owned by Russia.

Confiscating Russia’s central bank dollar reserves was “the single biggest Biden mistake,” Peter St. Onge, an economist at the Heritage Foundation, told the DCNF. “It put dozens of countries on notice that if the U.S. doesn’t like your policy, we’ll crash your economy and seize your dollars. In other words, dollars now carry a unique risk.”

Further, removing Russian banks from SWIFT “signaled to countries not politically aligned with the United States that we are willing to use the dollar as a political weapon, which made them reluctant to hold U.S. dollars,” Dr. Thomas Hogan, senior research faculty at the American Institute for Economic Research (AIER), told the DCNF.

Treasury Secretary Janet Yellen lauded the sanctions, stating they will be effective in preventing Russia from destroying Europe without hurting the U.S. “Our actions, taken in coordination with partners and allies, will degrade Russia’s ability to project power and threaten the peace and stability of Europe,” Yellen said at the time. “We are united in our efforts to hold Russia accountable for its further invasion of Ukraine while mitigating impacts to Americans and our partners.”

These sanctions against Russia have led countries to devise alternatives to the U.S. dollar, AIER economist Peter Earle told the DCNF.

China, Russia, Saudi Arabia, the United Arab Emirates and Brazil began trading in the Chinese Yuan and the Russian ruble instead of the U.S. dollar in 2023, according to NPR.

“No country wants to suddenly be unable to engage in international trade if they have a dispute or fall into disfavor with Washington D.C.,” Earle explained.

Additionally, Russian state-backed media has reported that Brazil, Russia, India, China and South Africa (BRICS) will soon announce a gold-backed currency.

“A gold-backed currency represents a real threat to all fiat monies, including the dollar,” Antoni told the DCNF.

“The real source of our power is the dollar,” Peter Schiff, the chief economist and global strategist of Euro Pacific Capital, told the DCNF. “If the dollar…