Conclusion

Abstract

In this book I have formulated a comparative capitalism perspective on relations of international monetary power to account for the rise in the global current account imbalances and the regional imbalances of the Eurozone. One of the key insights of the international monetary power literature is that the asymmetric distribution of autonomy is intrinsically connected to the asymmetric structure of the international currency system, in which the dollar remains the only “top currency” of the global economy. Because the dollar remains the most desired currency to be used for the denomination and settlement of cross-border trade, investment and foreign exchange reserves, the United States continues to wield hegemonic power in the global monetary system. From this perspective, the rise in the US current account deficit reflects the unique macroeconomic autonomy that comes with issuing the world’s key currency: the fact that the United States accumulated foreign liabilities on an unprecedented scale over the past two decades reflects its unique capacity to delay the burden of adjustment by attracting foreign capital and savings, which follows from the desire and need of foreign private and public actors to use the dollar as an internationally accepted means of exchange, unit of account and store of value. For this reason, the unparalleled rise in the US external deficits is not a manifestation of hegemonic decline but of the persistent structural monetary power the United States continues to enjoy.