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Home / Mike Norman Economics / Modern Monetary Theory (MMT) and the Power of the US Dollar in the World Economy (Part 1) — Stansfield Smith,

Modern Monetary Theory (MMT) and the Power of the US Dollar in the World Economy (Part 1) — Stansfield Smith,

Summary:
Stansfield Smith mounts an interesting argument that the USD is the only truly sovereign currency in the world taking the present monetary arrangements into account.  Owing to dollar hegemony, all other counties are dollar-dependent to one degree or another, which limits their ability to conduct policy independently in spite of their meeting MMT criteria for currency sovereignty.  So, while the MMT position may be correct technically, there is more to it than that, and this is an important element in the pursuit of neoliberalism, neo-imperialism, and neocolonialism as a world system and world order. It allows the US to both make the rules and also to break the rules when this is to its advantage. In other words, it is an imperial system. While the author doesn't mention it,

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Stansfield Smith mounts an interesting argument that the USD is the only truly sovereign currency in the world taking the present monetary arrangements into account. 

Owing to dollar hegemony, all other counties are dollar-dependent to one degree or another, which limits their ability to conduct policy independently in spite of their meeting MMT criteria for currency sovereignty. 

So, while the MMT position may be correct technically, there is more to it than that, and this is an important element in the pursuit of neoliberalism, neo-imperialism, and neocolonialism as a world system and world order. It allows the US to both make the rules and also to break the rules when this is to its advantage. In other words, it is an imperial system.

While the author doesn't mention it, there is also the issue of the US actively opposing other countries'' asserting independence from the dollar. Longish but worth a read.

Dissident Voice
Modern Monetary Theory (MMT) and the Power of the US Dollar in the World Economy (Part 1)
Stansfield Smith, Chicago ALBA Solidarity, long time Latin America solidarity activist, publisher of AFGJ Venezuela Weekly, and Senior Research Fellow at the Council on Hemispheric Affairs
Mike Norman
Mike Norman is an economist and veteran trader whose career has spanned over 30 years on Wall Street. He is a former member and trader on the CME, NYMEX, COMEX and NYFE and he managed money for one of the largest hedge funds and ran a prop trading desk for Credit Suisse.

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