An Exclusive Interview with Lewis E. Lehrman, Part 14

It is an extraordinary privilege to present this exclusive interview with Lewis E. Lehrman, in 21 installments, of which this is the fourteenth. 

Lewis E. Lehrman has written widely about economic and monetary policy.  He has co-authored the book Money and the Coming World Order (1976) with renowned MIT Economist Charles Kindleberger and others.  Lehrman has written about economics in publications such as Harper's, The Washington Post, The New York Times, The Wall Street Journal, Weekly Standard, Crisis, Policy Review and National Review.  His writings about monetary economics earned him an appointment by President Ronald Reagan to the Presidential Gold Commission in 1981.  Along with Congressman Ron Paul, Lewis Lehrman collaborated on a minority report of the commission, which was published as The Case for Gold (1982).

Lehrman published seven volumes on “Rueff Monetary Economics” (The Collected Works of Jacques Rueff, 1997, Plon, in French).  Jacques Rueff, the distinguished French monetary economist, established the monetary and economic plan of the Fifth French Republic, as President DeGaulle's chief financial advisor. The primary purpose of the plan was to restore economic prosperity, a stable French currency, and the end of French inflation by means of convertibility to gold of the French franc.  Lehrman has been named to the advisory board of the American Principles Project’s Gold Standard 2012 initiative.

 Lewis E. Lehrman [Photo by Ralph Benko]

Q13.  You, with Jack Kemp's then-chief economist and your long time colleague John Mueller, recently published a very prominent op-ed in the Wall Street Journal entitled How the 'Reserve' Dollar Harms America.  It has since been reprinted in (Moscow), (Accra), London, has been the subject of commentary in Mumbai, and, undoubtedly, will appear in other venues as well. 

What are some of the geopolitical and economic ramifications of the worldwide attention that the reserve currency status of the dollar now emerging may have?

The reserve currency role of the dollar, the evidence shows, increases the sovereign debt of the United States; it finances the growth of government; over the long run it makes the U.S. dollar less competitive, helping to turn a creditor country like the United States in 1945, into a debtor country in 2015.  And because dollar debt financing is readily available to the reserve currency country, the reserve currency country experiences the gradual real decline in the standard of living in the reserve currency country itself.  So it was in Spain in the 16th century, in France in the 17th and 18th centuries, and in the British Empire in the late 19th and early 20th centuries.

In a word, “the exorbitant privilege” of the reserve currency role of the dollar will turn out to be an exorbitant burden for the coming generations.  It does not have to be this way.


Kathleen M. Packard, Publisher
Ralph J. Benko, Editor

In Memoriam
Professor Jacques Rueff

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