In the past, I said that the birth of the euro created a challenge to the U.S. dollar’s (monopoly) position. Since the euro has greatly eroded the dollar’s market for expansion, the dollar is suffering an unprecedented difficulty. To suppress the euro, just relying on one or two credit rating organizations to lower the E.U. countries’ credit is not enough, because that will only have a short-term impact.
To eliminate the euro’s competition in the monetary market, the best approach is to create a long term strategy to suppress the E.U. Due to the E.U.’s financial transparency, spreading rumors and lowering credit ratings can damage the euro only in the short-term, but will not be able to shake its foundation. Creating troubles to dissolve the E.U. is rather difficult because almost all Europeans have accepted the E.U. model. At least the E.U. system enables Europe to develop peacefully without border disputes or other major conflicts. The internal issues within E.U. countries are low-level and low intensity. Creating conflicts among E.U. countries to dissolve the E.U., and thus eliminate the euro as a dollar competitor is an impossible job.
However, the euro presents too big a threat to the dollar. In the past the U.S. ignored the euro’s competitiveness. The euro’s existence has impacted monetary policy (such as bond issuance, cash issuance, the world’s flow of funds, and the foreign reserve allocation); greatly reduced the power of the dollar, the U.S.’ economic lever; and pushed the U.S. economy to the edge of a cliff. Therefore, the U.S. established its new strategy against the euro and the E.U.
Creating chaos in the Middle East is a major objective for the U.S. to target the E.U. Because the E.U. is heavily dependent on oil imports from the Middle East, the chaos in the Middle East will for sure stir up the E.U. countries’ appetite for interfering. To avoid the impact of the upcoming limited oil supply, the U.S. commenced offshore oil exploration along the U.S. coast (even the spill in the Gulf of Mexico could not change it) and also inland oil exploration in the U.S. After the U.S. was ready, turmoil showed up in Tunisia, Egypt, Yemen, Bahrain, and Syria. We can see the shadow of the U.S. as the leading factor in the turmoil in each country, but it presented the stereotype that “the U.S. does not want to see turmoil in the Middle East” to obscure its real intent. The Middle East is Europe’s oil lifeline and used to be under its influence. When there is chaos, many refugees escape directly to Europe, creating a huge social problem. Also the expectations regarding oil and other interests can create distrust and conflict among European countries. The Middle East is a good spark to trigger the E.U.’s unrest.
In addition, the United States has also laid a trap for the Europeans in Libya. The Europeans have their eyes on oil interests. Also, their set thinking is to maintain political influence in the Middle East and Africa. Therefore, instigating the Libyan rebels, getting NATO support, and fighting Gaddafi constitute a complete plan. Stirring Europe up to fight Libya while keeping the U.S. behind the scenes will allow Libya’s hatred of Europe to simmer. Adopting a slow war instead of a rapid war tactic gives Gaddafi time to plan for the worst and pushes him into a corner that will require him to use terrorism to fight back. The U.S. worried about how intensely Gaddafi would fight back, so it even prepared an ally for him. The by-product of bombing North Korea’s Embassy was to have North Korea support Gaddafi’s terrorist actions. If Gaddafi conducts powerful terrorist activities in Europe, the E.U.’s foundation will weaken. Then the U.S. can utilize the countries’ conflicts and take advantage of the situation. Dismantling the E.U. then becomes a possibility. When the E.U. has problems, no European country will be willing to be responsible for the euro. This will also teach a lesson to those countries that prefer the euro to the dollar.
The general objective of the U.S.’s new strategy is to eliminate the euro and remove obstacles to the dollar. The goal of creating chaos in the Middle East and attacking Libya was to disrupt Europe. To disrupt Europe will lead to the dissolution of the E.U. Dissolving the E.U. will result in the elimination of the euro.
Endnotes:
[1] Guangming Online, “Analysis of the U.S. New Strategic Direction,” May 15, 2011.
http://theory.gmw.cn/2011-05/15/content_1960264.htm.