Skip to main content

From Gold Standard to Petrodollar: The Rise and Fall of the American Empire

Since Roosevelt's administration installed the designs of the New Deal era in the United States, the role of government in the lives of the American people has transformed. 

Over the course of World War II and the ensuing intra-Cold War conflicts, the War on Poverty, the War on Drugs, the space race, and the arms race, the United States accrued a tremendous pool of liabilities in order to fund these extravagant projects. 

Following World War II, the United States and the major market powers agreed to Bretton Woods, which established the United States dollar as the benchmark for the rest of the world's currencies. 

The United States dollar was then denominated in units of gold, redeemable at the request of the bearer of those reserves on the international scene. 

By this time, President Franklin Roosevelt had already issued Executive Order 6102 outlawing personal ownership of gold as money or hoarding thereof, but the United States dollar still operated from this system on the international scale. 

By 1971, the United States had long abused its privilege by expanding its money supply, or issuing debt it could never repay, in order to satisfy the whims of over-promising administrations. 

At the time, President Nixon elected to temporarily close the gold window, all in response to the requests for redemption of gold by its international creditors. 

This was, contrary to popular belief, a moment in American history when the United States government effectively defaulted on its debts and admitted its insolvency. 

Shortly thereafter, in order to artificially prop up the United States dollar, Nixon negotiated a system of mutual advantage with the government of Saudi Arabia which would grant the Saudis arms and protections through United States defense while Saudi Arabian oil transactions would be exclusively denominated in United States dollars. 

Subsequently, OPEC espoused this system and the United States government was thus permitted further extravagance with its inflationary monetary policy, over which period of time the United States dollar experienced an expansion of supply on the magnitude of greater than twenty-fold, while the dollar price of gold has soared nearly 5700%. 



Over the course of the past two decades, the United States dollar's global reserve status has waned and its hegemony has been threatened by OPEC nations' refusal to accept further trade in United States dollars, while some of the United States' greatest creditors, including China, have declared their reluctance to hold or accumulate further United States treasuries. 

This imperils the stability of the United States dollar, which is, of course, the lifeblood of the American markets. 

Without this stronghold upon the petrodollar system, the United States dollar will surrender its global reserve status and will vacate its position in the international market as a mere facilitator of trade and exporter of inflation. 

This is the basis of the war efforts in the Middle East today and the impetus for the largely acceptable propaganda Americans regularly observe and accept.

Comments

Post a Comment

Popular posts from this blog

Death by Socialism

This title is available for purchase on Amazon ,  Lulu ,  Barnes & Noble , and Walmart .
1 comment
Read more

Rally for Route 66!

Keep up the fight for the Mother Road! Rally for Route 66! There is a lot at stake in preserving this irreplaceable monument to American history, not merely as a tourist attraction but as a means to permitting a glimpse into our past, as a means to virtual time-travel into a time and space otherwise inaccessible, as a means to capturing the imaginations of future generations and to preserving the memory of our forbears in both form and spirit.  We are nothing without reverence for our forbears, without our heritage or our identity as a people, without the preserved memory of our history. Without these reminders, without the tangible connections to our past and the efforts which have forged our path and come to define us, without these monuments to the pioneering and the innovative, we are destined to forget all of that which makes us uniquely human, all of that which has afforded us so much insight and abundance, all of that which has given us pause to reflect and remember and to a...
Post a Comment
Read more

Failure by Design

In the case for liberty, there is certainly some tolerance for error or failure, as it is generally suffered by the individual and not brought upon anyone by design . Wherever anyone seeks to empower government, however, one must be reasonably certain of the designs, the logic and the costs, and he must be equally honest about the unknowns as with the foreseeable consequences; after all, there is no margin for error where those designs are administered by the barrel of a gun.  One must necessarily remember that government is a monopoly on force and coercion, that force and coercion serve together as the modifying distinction between government and enterprise. It is a kind of force and coercion not by spirit or intention of written law but in accordance with the letter and understanding of the enforcers in their own time, in their own limited judgment and impaired conscience. As opposed to a state of liberty, where mistakes, failures and crimes are unavoidable in the face of human f...
Post a Comment
Read more