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When Americans help yuan to emerge a reserve currency...
The economic and political crisis facing the US has been unprecedented.

American legislators were left grappling with an almost 16 day shutdown of the US government and the prospect of a debt default if the debt ceiling was not removed. Even though a deal was struck at the last second to avoid a debt default, it left many questions un answered.

This crisis of America was largely of its own making with amateur activism from both ends of the political spectrum. While Barack Obama did not come out as a great leader, the Republicans were strangled by the right extreme. Tea party activists thought Obama care was more dangerous than the country running into default. While these were domestic issues, the ripple effect was felt world over since the global economies were afraid because of their over reliance on the American economy. The nature of the globalised world is such that America’s policies and issues have effect across the world. A prime example would be the free spin of the Indian rupee after indications by the Fed that they would begin tapering it off last August. All of these uncertainties have led to the second largest economy in the world, China, asking should we de-Americanise ourselves?

 

Chinese onslaught...

Xinhua, China’s main newspaper, had a very strong editorial that echoed this opinion and there are a number of leaders who are asking this question. At the core of these questions, is the irresponsibility that American lawmakers have been exhibiting. The impact on the global markets has been erratic and has caused a lot of instability in emerging markets such as the BRIC countries. In addition, countries such as China and Japan have almost 1/3 of the total US treasury reserves and are highly dependent on the stability of the dollar. As such, the antics of the Americans over recent years have left many to wonder if America could indeed play the leadership role that once it espoused as its birthright.

Considering that the financial crisis triggered by Lehmann Brothers was America’s own mess and that nothing has been done to set it right, it has further dented the reliability of the dollar. The increase in investments by China across the world, mostly in Africa, in road and railway projects has led to an increase in their economic and social presence world over. As such, there is a possibility, even though it is a faint one, where the Yuan could set up a reserve currency with Hong Kong as the epicenter of the global financial markets. Besides the economic irresponsibility, there is also the NSA angle that is causing uncertainty for America.

The NSA leaks by Snowden has put America in a spot across the world with world leaders questioning the surveillance especially on world leaders. Though India has not voiced any significant protest, the EU has passed a strong resolution condemning these activities without prior knowledge of anyone concerned. It rattled the Brazilian President so much that she cancelled an impending visit to

Washington as a protest against spying on her office through NSA. As such, there is an increasing feeling that America’s superpower status is falling apart. The world is becoming more courageous to take on the Americans and is getting frustrated at the intrusions that America is making in their own lives. It has also set a thought process of trying to socially de-Americanise from the oversight of America.

 

Is it practical...

While this is interesting in theory, in practice it is much harder. For all its shortcomings, America is still one of the most transparent democracies in the world. It has a robust innovative society that is hard to match. Adding to that handicap, countries like China lack democracy and social openness that America so ardently possesses. As such, overthrowing the American identity and the economic currency would require a significant push from China and others over a sustained period of time. However, the alarm bells are ringing. The fact that the world is even thinking about de-Americanising themselves tells about the mess that the US has created for itself.

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