“Access to the American market should cost you. Additional tariffs or additional levies — of course it makes sense to tie it to foreign policy,” said Steve Cortes, a former adviser to President Donald Trump, earlier this summer. “You just have to decide, is it worth it? If it is, well, play by our rules.”
The dependability of the dollar and our stable financial system run much of the world. However, the chaos of Trump’s policies and the growing importance of BRICS — the intergovernmental organization that includes Brazil, Russia, India, China and South Africa — could cause the dollar to lose its status as the world’s primary currency.
Trump is shredding some trade agreements from his first term. As I see it, his unpredictable actions make the rest of the world mistrust the United States. Threatening to not pay our debts, levying sanctions and getting rid of the chairman of the Federal Reserve all seem possible in Trump’s playbook.
His idea of bringing interest rates down could have the unintended consequence of increasing demands, pushing up prices and causing inflation.
One of the stated reasons for the tariffs was to bring manufacturing back to the United States. Because automation is used in much of manufacturing and farming, great jobs in those areas are not likely to return, despite the tariffs.
When we so freely impose sanctions, other countries watch and question their reliance on the dollar. If they switch to another currency, our economic influence around the world will be eroded. The dollar is still much preferred over the Chinese yuan, but that could change since China is actively courting other nations to join the 10 already in BRICS.
Carol Wolford
West Donegal Township
