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As a US taxpayer I don’t particularly like this. We rely on being the world’s reserve currency, and many things get more expensive, e.g., serving government deb

As a US taxpayer I don’t particularly like this. We rely on being the world’s reserve currency, and many things get more expensive, e.g., serving government debt. In 2000-2001 we were able to effectively bully three countries that were talking about moving away from the US dollar, but I am not sure if that works now. I have a lot of personal theories how my country can best cope with future geopolitical adjustments. If I were in charge, the first thing I would do would be to close most foreign military bases. We can have the strongest military in the world and have them largely based in the US. I think the US Navy continues to be a good investment, but I would cut back a small amount on intel and other military branches.

mschuster91 2y ago
> We rely on being the world’s reserve currency And that won't change any time soon. The Euro is a decent currency but we're too disjoint to back something supposed to be a reserve currency, and China's Yuan is too much controlled by the government (and exchange limited) to be viable.
lolinder 2y ago
> If I were in charge, the first thing I would do would be to close most foreign military bases. We can have the strongest military in the world and have them largely based in the US. The strategy behind the foreign military bases isn't just about having the strongest military in the world. They serve two purposes: First, we want to preserve the credible threat of boots on the ground anywhere in the world within just a few hours of a conflict beginning. Think edge computing, but for military operations. Second, we want to reassure our allies that they have more than just our word for it that we'll come to their aid in a crisis. Having US soldiers in your country 24/7 functions as a guarantee that if the country falls to an invader the US will have to respond, because our soldiers were captured or killed. The concern is that without the bases, a hostile power (like, say, the one TFA is about) could invade an ally (like, say, the Baltic states) with overwhelming force and present NATO with a fait accompli before we have time to react. Pulling away from those bases would be correctly seen by many of our allied states as relaxing our commitment to them.
- mark_l_watson 2y ago
  I don’t argue with your main points except to question if it is worth the money now. I was in the defense industry for 25 years, and my comments above are just my opinions on what is in the best interests of the US taxpayer today in 2024. I am questioning the value of having 800 military bases in foreign countries in 2024. What was once a good idea may not be worth the money and resources now. What does the US give up not protecting the rest of the world? I think these topics are worthy of serious dialogue.
  - lazide 2y ago
    What is the cost economically of not having those bases? Consider one result may be the USD not being used as a reserve currency as widely, or at all.
  - JumpCrisscross 2y ago
    > What does the US give up not protecting the rest of the world? The number of lives we’d lose in the next world war. The end of Pax Americana won’t be sweet. That said, I agree there should be more thought as to the marginal benefit of the 800th base.
    - psunavy03 2y ago
      The marginal benefit of the so-called 800th base is giving planners and operations officers options in a crisis. The more places you either have your own infrastructure or access agreements or leases with a host country, the more you can a) disperse your force and complicate targeting when on the defensive and b) have multiple avenues of approach when on the offensive. If the enemy knows all your forces have to flow into theater via airlift landing at Krablakistan Air Base in Elbonia, they're going to make war plans involving targeting your transports and pounding the living shit out of Krablakistan Air Base with air strikes and/or ballistic missiles. And beforehand, they'll do their level best to sow discord between your government and the Elbonians to the point they reconsider your access to their base in a crisis.
    - exceptione 2y ago
JumpCrisscross 2y ago
> We rely on being the world’s reserve currency During petrodollar era, the 1970s and 80s, the dollar was used less than it is today. (Certainly within the USSR and even the Russian SSR.) We de facto banned Russia from using the dollar in 2022 [1]. That it took Moscow over two years just get down to 50% speaks volumes to the dollar’s strength. [1] https://home.treasury.gov/news/press-releases/jy0612 https://home.treasury.gov/news/press-releases/jy0612
- airstrike 2y ago
  side note: I just wanted to commend you for your tireless responses and fact-checking on this otherwise dumpster fire of a comment section. you're doing god's work here
nemo44x 2y ago
Russia's GDP (nominal and especially per capita) aren't very significant. I understand your concern but Russia departed less by choice and more because they had to.
audunw 2y ago
Are you really worried about the dollar being threatened? What is the alternative? There isn’t any at the moment is there? Some countries may try to move away from the dollar to some degree but it’s not like the Yuan or Ruble is remotely close to replacing it. It’s not even clear that China or Russia would even want them to. China would have to give up capital control which doesn’t seem likely. They’re too afraid of capital flight. All these ideas of some kind of blockchain based common alternative is still just a pipe dream. You can’t base a real currency on crypto. If you think you can you don’t understand what currency actually is (hint: currency has never been a successor to metal/coin based transactions… it’s an abstraction over debt and debt has and will always be the main way value is exchanged. crypto cant replace debt based currency because debt is based on trust in humans, something that trust in an algorithm can’t replace)
- mark_l_watson 2y ago
  Good question. I don’t worry so much about any other single currency taking over as the reserve currency. Rather, I think individual pair-ups of trading partners will more frequently trade with each other in their own currencies. It is the dilution of the use of dollars that concerns me. I share some of your lack of enthusiasm for crypto currencies. Rather, as individual countries trade between themselves it may often be advantageous for them to use their own currencies, especially if they don’t have to hold other countries’ currencies for long periods of time. Non-US countries pay quite a penalty for holding lots of dollars. I expect every country to do what is in their own best interests, just as I hope my country makes good long term economic and geopolitical decisions.
astrodust 2y ago
"We can have the strongest military in the world and have them largely based in the US." Sure, if you want a really strong Coast Guard. As soon as you venture out of that little bubble you're going to need ports, air-bases, and other facilities. China is suffering from a lack of these, they really can't operate anywhere in the world like the US can. The same goes for Russia. In effect, those two are completely boxed in. By things like US bases all over the world. You can even argue that historically Britain was disproportionately powerful because of their extensive network of bases and ports. Trade was relatively easy for them, while other European powers never had the same access. Like it or not, the ability to trade and the strength of your power projection are often deeply inter-linked.
MangoCoffee 2y ago
>We rely on being the world’s reserve currency, "Saudi Arabia ends 80-year petrodollar deal with US for multi-currency sales" https://www.indiatoday.in/business/story/saudi-arabia-ends-80-year-petro-dollar-oil-with-us-dollar-for-multi-currency-sales-2552844-2024-06-13 https://www.indiatoday.in/business/story/saudi-arabia-ends-8... "No empire lasts forever, no dynasty continues unbroken" edit: Since the U.S.'s war on terrorism, the U.S. has said that every trade done in dollars is de facto done on U.S. soil and thus subject to U.S. laws. I'm surprised that more countries have not tried to cut ties with the U.S. dollar.
- JumpCrisscross 2y ago
  The petrodollar era ended between the 90s and 2000s. The Saudis switching from swapping U.S. dollars for oil to swapping yuan for dollar-pegged Saudi riyals is peak nothingburgerism. (Did you know the British have always sold oil for pounds?)
  - tim333 2y ago
    Yeah, for international trade I don't think it matters what currency you use. USD GBP Dogecoin or whatever. It's mostly for convenience people use USD. For domestic stuff the currency is important as people have their wages and bills in that.
throwadobe 2y ago
this has very little impact on the strength of the dollar. if anything, it's a better signal of Russia's economic weakness (in the face of sanctions) than a power shift in favor of the Yuan. forgoing foreign bases and limiting the US military presence to domestic only is such a ludicrous take that I'm willing to bet would have you laughed out of any room discussing defense.
- mark_l_watson 2y ago
  Well, organizations making large profits would like to laugh me out of the room. Next to tech stocks, ‘defense’ stocks are my second largest basket of stocks. I don’t expect that these companies will stop making large profits for the near future, but I keep an eye on my investments. I find it interesting, in general, in this thread, that so many people dismiss what on the surface is a contrarian view (i.e., drastically reduce our overseas military presence), without more open debate. Maybe my idea is wrong, but I feel it is worth a conversation.
  - throwadobe 2y ago
    > drastically reduce our overseas military presence for what? a smaller deficit? it's unclear whether reducing the size of the defense industry helps the US economy, so maybe you get a smaller deficit but you also raise unemployment by a couple % and lower economic growth by a % or so over the next 25 years conversely, it's pretty clear this does hurt its current hegemonic position. that's a gamble not many are willing to take so carelessly I say this as a non-American, by the way
hackeraccount 2y ago
I don't know how you stop it but the reserve currency status of the dollar is doing the US no good. It encourages the worst non-productive kind of behavior and the fact of it will be it's own undoing.

mschuster91 2y ago

> We rely on being the world’s reserve currency And that won't change any time soon. The Euro is a decent currency but we're too disjoint to back something supposed to be a reserve currency, and China's Yuan is too much controlled by the government (and exchange limited) to be viable.

lolinder 2y ago

> If I were in charge, the first thing I would do would be to close most foreign military bases. We can have the strongest military in the world and have them largely based in the US. The strategy behind the foreign military bases isn't just about having the strongest military in the world. They serve two purposes: First, we want to preserve the credible threat of boots on the ground anywhere in the world within just a few hours of a conflict beginning. Think edge computing, but for military operations. Second, we want to reassure our allies that they have more than just our word for it that we'll come to their aid in a crisis. Having US soldiers in your country 24/7 functions as a guarantee that if the country falls to an invader the US will have to respond, because our soldiers were captured or killed. The concern is that without the bases, a hostile power (like, say, the one TFA is about) could invade an ally (like, say, the Baltic states) with overwhelming force and present NATO with a fait accompli before we have time to react. Pulling away from those bases would be correctly seen by many of our allied states as relaxing our commitment to them.

mark_l_watson 2y ago
I don’t argue with your main points except to question if it is worth the money now. I was in the defense industry for 25 years, and my comments above are just my opinions on what is in the best interests of the US taxpayer today in 2024. I am questioning the value of having 800 military bases in foreign countries in 2024. What was once a good idea may not be worth the money and resources now. What does the US give up not protecting the rest of the world? I think these topics are worthy of serious dialogue.
- lazide 2y ago
  What is the cost economically of not having those bases? Consider one result may be the USD not being used as a reserve currency as widely, or at all.
- JumpCrisscross 2y ago
  > What does the US give up not protecting the rest of the world? The number of lives we’d lose in the next world war. The end of Pax Americana won’t be sweet. That said, I agree there should be more thought as to the marginal benefit of the 800th base.
  - psunavy03 2y ago
    The marginal benefit of the so-called 800th base is giving planners and operations officers options in a crisis. The more places you either have your own infrastructure or access agreements or leases with a host country, the more you can a) disperse your force and complicate targeting when on the defensive and b) have multiple avenues of approach when on the offensive. If the enemy knows all your forces have to flow into theater via airlift landing at Krablakistan Air Base in Elbonia, they're going to make war plans involving targeting your transports and pounding the living shit out of Krablakistan Air Base with air strikes and/or ballistic missiles. And beforehand, they'll do their level best to sow discord between your government and the Elbonians to the point they reconsider your access to their base in a crisis.
  - exceptione 2y ago

JumpCrisscross 2y ago

> We rely on being the world’s reserve currency During petrodollar era, the 1970s and 80s, the dollar was used less than it is today. (Certainly within the USSR and even the Russian SSR.) We de facto banned Russia from using the dollar in 2022 [1]. That it took Moscow over two years just get down to 50% speaks volumes to the dollar’s strength. [1] https://home.treasury.gov/news/press-releases/jy0612 https://home.treasury.gov/news/press-releases/jy0612

airstrike 2y ago
side note: I just wanted to commend you for your tireless responses and fact-checking on this otherwise dumpster fire of a comment section. you're doing god's work here

nemo44x 2y ago

Russia's GDP (nominal and especially per capita) aren't very significant. I understand your concern but Russia departed less by choice and more because they had to.

audunw 2y ago

Are you really worried about the dollar being threatened? What is the alternative? There isn’t any at the moment is there? Some countries may try to move away from the dollar to some degree but it’s not like the Yuan or Ruble is remotely close to replacing it. It’s not even clear that China or Russia would even want them to. China would have to give up capital control which doesn’t seem likely. They’re too afraid of capital flight. All these ideas of some kind of blockchain based common alternative is still just a pipe dream. You can’t base a real currency on crypto. If you think you can you don’t understand what currency actually is (hint: currency has never been a successor to metal/coin based transactions… it’s an abstraction over debt and debt has and will always be the main way value is exchanged. crypto cant replace debt based currency because debt is based on trust in humans, something that trust in an algorithm can’t replace)

mark_l_watson 2y ago
Good question. I don’t worry so much about any other single currency taking over as the reserve currency. Rather, I think individual pair-ups of trading partners will more frequently trade with each other in their own currencies. It is the dilution of the use of dollars that concerns me. I share some of your lack of enthusiasm for crypto currencies. Rather, as individual countries trade between themselves it may often be advantageous for them to use their own currencies, especially if they don’t have to hold other countries’ currencies for long periods of time. Non-US countries pay quite a penalty for holding lots of dollars. I expect every country to do what is in their own best interests, just as I hope my country makes good long term economic and geopolitical decisions.

astrodust 2y ago

"We can have the strongest military in the world and have them largely based in the US." Sure, if you want a really strong Coast Guard. As soon as you venture out of that little bubble you're going to need ports, air-bases, and other facilities. China is suffering from a lack of these, they really can't operate anywhere in the world like the US can. The same goes for Russia. In effect, those two are completely boxed in. By things like US bases all over the world. You can even argue that historically Britain was disproportionately powerful because of their extensive network of bases and ports. Trade was relatively easy for them, while other European powers never had the same access. Like it or not, the ability to trade and the strength of your power projection are often deeply inter-linked.

MangoCoffee 2y ago

>We rely on being the world’s reserve currency, "Saudi Arabia ends 80-year petrodollar deal with US for multi-currency sales" https://www.indiatoday.in/business/story/saudi-arabia-ends-80-year-petro-dollar-oil-with-us-dollar-for-multi-currency-sales-2552844-2024-06-13 https://www.indiatoday.in/business/story/saudi-arabia-ends-8... "No empire lasts forever, no dynasty continues unbroken" edit: Since the U.S.'s war on terrorism, the U.S. has said that every trade done in dollars is de facto done on U.S. soil and thus subject to U.S. laws. I'm surprised that more countries have not tried to cut ties with the U.S. dollar.

JumpCrisscross 2y ago
The petrodollar era ended between the 90s and 2000s. The Saudis switching from swapping U.S. dollars for oil to swapping yuan for dollar-pegged Saudi riyals is peak nothingburgerism. (Did you know the British have always sold oil for pounds?)
- tim333 2y ago
  Yeah, for international trade I don't think it matters what currency you use. USD GBP Dogecoin or whatever. It's mostly for convenience people use USD. For domestic stuff the currency is important as people have their wages and bills in that.

throwadobe 2y ago

this has very little impact on the strength of the dollar. if anything, it's a better signal of Russia's economic weakness (in the face of sanctions) than a power shift in favor of the Yuan. forgoing foreign bases and limiting the US military presence to domestic only is such a ludicrous take that I'm willing to bet would have you laughed out of any room discussing defense.

mark_l_watson 2y ago
Well, organizations making large profits would like to laugh me out of the room. Next to tech stocks, ‘defense’ stocks are my second largest basket of stocks. I don’t expect that these companies will stop making large profits for the near future, but I keep an eye on my investments. I find it interesting, in general, in this thread, that so many people dismiss what on the surface is a contrarian view (i.e., drastically reduce our overseas military presence), without more open debate. Maybe my idea is wrong, but I feel it is worth a conversation.
- throwadobe 2y ago
  > drastically reduce our overseas military presence for what? a smaller deficit? it's unclear whether reducing the size of the defense industry helps the US economy, so maybe you get a smaller deficit but you also raise unemployment by a couple % and lower economic growth by a % or so over the next 25 years conversely, it's pretty clear this does hurt its current hegemonic position. that's a gamble not many are willing to take so carelessly I say this as a non-American, by the way

hackeraccount 2y ago

I don't know how you stop it but the reserve currency status of the dollar is doing the US no good. It encourages the worst non-productive kind of behavior and the fact of it will be it's own undoing.