America Is in Trouble. Who’s to Blame?

Andy Snyder|April 11, 2023

Whoops…

“By joining the WTO, China is not simply agreeing to import more of our products. It is agreeing to import one of democracy’s most cherished values: economic freedom,” President Bill Clinton said in March 2000.

“When individuals have the power not just to dream but to realize their dreams, they will demand a greater say.”

It’s hard to say whether he knew it or not… but he lied.

With that, we continue our saga on the death of the dollar.

Economic freedom is hardly common in Communist China. In fact, two decades after Clinton’s speech, it appears the oppression and control Beijing is so infamous for is spreading around the world… even here at home.

Our little narrative could go in many directions from here.

Trouble

We could talk about the hypocrisy of Washington’s knee-jerk reaction to ban TikTok via the RESTRICT Act and the horrific breach of freedom that would come with it.

We could write about the latest surge from the IRS and its yearning to use digital dollars to track every penny we spend… and who gets it.

Or we’d love to share with you all the ways this “fair trade” has crushed the American middle class, creating income inequality that is quickly rivaling the disparities in the poor, poor third-world countries we love to meddle with.

You won’t hear this from the folks in Washington… but America’s top 1% (the folks who win the most from our foreign trade) own 32% of the nation’s wealth.

China’s top 1% own 33% of its nation’s wealth.

The Gini coefficient is what we use to measure such things scientifically. It was developed to measure economic equality. A reading of 0 represents perfect equality. A reading of 1 represents perfect inequality.

Historically, anything above 0.4 has been a warning sign.

China’s Gini coefficient is 0.466.

America – the land of the free – hangs its head with a figure of 0.49.

In a sense, perhaps Clinton was right. China’s figure has fallen steadily since he uttered the words above. But it’s come at a cost. America’s figure has risen sharply over the last two decades.

But there’s something much bigger in all of this… something Clinton didn’t bank on (at least we pray he didn’t).

By opening our economic borders to China, Washington has bankrolled its own demise.

Since the end of World War II, America has enjoyed (and taken advantage of) its role as the printer of the world’s reserve currency. It’s given us a huge economic advantage and made our debt not just easy to create… but vital for the world’s interest.

That’s changing.

Three’s a Crowd

Late last month, China inked a monumental deal with Brazil.

For decades, the U.S. was Brazil’s largest trade partner. It only made sense that all of the country’s foreign business was done in American dollars. But recently, China has stepped up its game. It now supplies more to Brazil than America does.

And because of it… the couple is trading without using the dollar.

It’s possible because the world now has enough of China’s money that it doesn’t need to sweat over its greenback reserves – thanks, Mr. Clinton.

Brazil isn’t the only country avoiding the dollar.

India is following suit. So is Saudi Arabia. And, of course, Russia.

Even our good friends are joining in. China recently made a trade with France using yuan.

In fact, just days ago, France’s Emmanuel Macron warned against the “extraterritoriality of the U.S. dollar.”

Uh oh.

We all know the dollar’s time will come. The average reserve currency lasts about 100 years. Fiat currencies (those backed by nothing but a promise) last a mere 27 years.

The greenback has been the global reserve for over 90 years… and a fiat form of money for more than 40 years.

Trouble seems to be right around the corner.