Trump vs. the Dollar

The Ezra Klein Show

New York Times Opinion

Society & Culture, Government, News

4.6 • 11K Ratings

🗓️ 2 May 2025

⏱️ 63 minutes

🔗️ Recording | iTunes | RSS

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Summary

The U.S. dollar is the lingua franca of the global financial system. The fact that so much of the world relies on our currency has long been understood as our exorbitant privilege — the reason we have so much leverage in the global economy and are able to borrow at lower interest rates. But the Trump administration has a much more complicated relationship with the dollar. It has come to see dollar dominance as a burden we bear on behalf of the rest of the world. But in its attempts to move away from dollar dominance, is the Trump administration on the verge of creating a financial crisis? Kenneth Rogoff is a former chief economist at the International Monetary Fund and a professor of economics at Harvard University. He has a book coming out called “Our Dollar, Your Problem.” In this conversation he walks through the history of dollar dominance, why it’s been waning in recent years and what ripple effects the Trump administration’s policies might have. This episode contains strong language. Book Recommendations: Muppets in Moscow by Natasha Lance Rogoff The Queen’s Gambit by Walter Tevis Benjamin Franklin by Walter Isaacson Thoughts? Guest suggestions? Email us at [email protected]. You can find the transcript and more episodes of “The Ezra Klein Show” at nytimes.com/ezra-klein-podcast. Book recommendations from all our guests are listed at https://www.nytimes.com/article/ezra-klein-show-book-recs.html This episode of “The Ezra Klein Show” was produced by Rollin Hu. Fact-checking by Michelle Harris, with Kate Sinclair and Mary Marge Locker. Our senior engineer is Jeff Geld, with additional mixing by Aman Sahota. Our executive producer is Claire Gordon. The show’s production team also includes Marie Cascione, Annie Galvin, Elias Isquith, Marina King, Jan Kobal, Kristin Lin and Jack McCordick. Original music by Pat McCusker. Audience strategy by Kristina Samulewski and Shannon Busta. The director of New York Times Opinion Audio is Annie-Rose Strasser.

Transcript

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0:00.0	The
0:07.0	The For decades now, America has dominated the global financial system.
0:35.3	Our currency is the currency that international trade runs on.
0:39.3	Our financial plumbing is a plumbing that basically everybody, to some degree or another, uses.
0:44.9	This has been called our, quote, exorbitant privilege. Because of it, our borrowing costs are lower.
0:51.2	Because of it, we know things about the global economy. Nobody else knows.
0:54.6	Have access to information nobody else has access to. We can wrap sanctions around our
1:00.3	enemies in a way no one else can. The worry for a long time has been that the world will
1:07.7	slip out of this system. There have been challengers, Japan in the 80s, the EU,
1:14.4	in the 2000s, now China, but no one has really come anywhere near to slodging it.
1:21.4	And that was partially because it's hard to build something new, and partially because we were
1:25.5	fairly, at least until recently, restrained in how we used it. We are in a way selling the world, our currency, and our financial
1:32.7	system to make it easier for them to do their transactions. We don't want to make it too hard
1:38.7	to use the thing we're selling. The Trump administration is at a much more complicated
1:43.1	relationship with this, to say the least.
1:45.8	They've come to see dollar dominance and its cousin, our military dominance, as a burden we bear on behalf of the rest of the world.
1:53.8	And a burden they should be paying more for the privilege of using.
1:57.9	They think that having dollar dominance is made our dollar too expensive, which has hurt
2:02.1	manufacturing, even if it's meant cheap consumer goods. And they think that it's given us leverage
2:06.9	that all these idiots who came before them just haven't used, but they're going to use it.
2:12.7	Ken Rogoff is the former chief economist at the International Monetary Fund. He's a professor of economics at Harvard,
2:18.9	and he has a new book coming out, very well-timed, it drops on May 6, called Our Dollar, Your Problem,
	...

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