53: The Dominance of the US Dollar and Its Challenges. Alex Pollock (Senior Fellow at the Mises Institute) discusses Kenneth Rogoff's book, Our Currency, Your Problem, focusing on why the US dollar remains the dominant global currency. The dollar's strength i

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John Batchelor

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🗓️ 6 November 2025

⏱️ 11 minutes

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Summary

The Dominance of the US Dollar and Its Challenges. Alex Pollock (Senior Fellow at the Mises Institute) discusses Kenneth Rogoff's book, Our Currency, Your Problem, focusing on why the US dollar remains the dominant global currency. The dollar's strength is linked to US military power and superior legal and bankruptcy systems, which provide essential "social infrastructure." Pollock recalls the famous quip, "Our currency, your problem," made by Treasury Secretary John Connally in 1971 after the US defaulted on its gold obligations under the Bretton Woods system. Challenges from the Chinese renminbi and crypto are noted, but Rogoff finds serious institutional flaws in China's system. Critically, the growing US national debt is identified as the dollar's "Achilles heel," posing a major threat if global lenders stop lending.
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0:00.0	This is CBSI on the world. I'm John Batchel. The U.S. Dollar. I welcome Alex Pollock, senior fellow at the Mises
0:12.6	Institute, author of Finance and Philosophy, Why We're Always Surprised, and the co-author of Surprised
0:18.6	Again, writing most recently for Civitas Outlook, published by
0:23.0	Civitas Institute at the University of Texas at Austin, a new book by Kenneth Rogoff,
0:29.3	Our Currency, Your Problem, restates why it is the dollar, remains the supreme currency,
0:35.5	the agreed upon desirous currency of the face of the earth,
0:39.0	despite the vicissitudes of the late 20th century.
0:42.9	Alex, a very good evening to you, that remark, the quip, the bomo,
0:48.1	our currency, your problem, was made by then Secretary of the Treasury,
0:52.3	John Connolly, former governor of Texas, a man who was
0:55.9	often seen as a presidential contender. He was being blunt, at the same time witty, at a
1:02.7	circumstance that was then extant and dominated the conversation. It was 1971. What had
1:09.0	happened that the secretary made such an, we can now say,
1:13.6	undiplomatic but candid remark.
1:15.6	Good evening to you, Alex.
1:17.9	Good evening.
1:18.8	And thank you very much for having me on.
1:21.6	It was August 1971 that a world historical event happened, at least as far as monetary history.
1:29.5	And that was the default or the reneging by the United States under President Nixon,
1:36.9	with the help of his secretary of the Treasury, John Connolly, as you say,
1:41.2	to refuse the obligations under the Brettonwood system of the United States
1:47.8	to redeem dollars for foreign central banks or governments, to redeem them for gold
	...

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