Interesting analysis. I’ve been trying to keep a clear head about China because ever since Obama declared “pivot to Asia,” the anti-Chinese media campaign kicked off. We were admiring China’s development, patting ourselves on the back, saying capitalism lifts people out of poverty less than twenty years ago, but now we’re saying, woah China! You can’t be better than US – get back in your place!
From my perspective, China is doing its own thing and doesn’t intend to compete for global status. China states it’s committed to communist and socialist ideals and seems to be determined to achieve national goals using a blend of economic systems. Trade with foreign countries and manufacturing the world’s goods generated the wealth to lift almost a billion Chinese out of poverty.
US control of the world’s financial and economic systems enabled the power to dictate the rules, while the military enforces them. Under the guise of international development, US companies “invested” in countries by outsourcing American manufacturing and assuming ownership of natural resources. The activities promised to enrich nations, but they impoverished them and then offered harsh IMF loans.
Somehow, China evaded this and maintained some sort of financial sovereignty that facilitates an alternative to the US system. This threatens dominance over the global south by forcing the US (China too) to offer equitable economic agreements, but the US really burned its bridges, and countries prefer to work with China. So, it’s not that China is trying to break our hold on the world’s economy – it’s that the US shot itself in both feet and no one trusts us.
However, currencies are mostly irrelevant. Control of the world’s only financial system facilitated the power to economically dominate the world (among a few other things). The Yuan won’t replace the dollar anyway, but a new, hopefully, more democratic structure will evolve, and my bet is on BRICS.
Plus, how does the USD as the reserve currency benefit the average American citizen? It symbolizes some sort of power, but the American workforce generates the nation’s value and wealth.
