Qiushi recently republished a Red Flag Manuscript article with the title, “The Dividends of Hegemony: America’s Source for Reaping without Sowing.” Two researchers, Yang Duogui and Zhou Zhitian, from the Science and Technology Policy and Management Institute of the Chinese Academy of Sciences were the authors.
The article said, “Since 500 years ago, from Portugal, Spain, and the Netherlands to England, and then to the United States, state ‘hegemony’ has gradually developed from the traditional ‘territorial colonization’ into a modern ‘financial colonization.’ Today, for the U.S., as the world’s only superpower, financial colonization is its core secret for maintaining its hegemony power. For the Americans, financial hegemony has become the cornerstone for the United States to be able to obtain its hegemony dividend. It is the source for reaping profits without sowing.”
The article summarized the following ten major ways and channels the U.S. uses to harvest its “hegemony dividends”: 1) Seigniorage. The author calculated that “assuming that all of China’s foreign exchange reserves are held in U.S. Treasury bonds and the interest spread between U.S. Treasury bonds and China Treasury bonds is one percent, then each year the United States will get about US$ 23-26 billion in seigniorage at a minimum from China’s economic development without paying any costs.” 2) International inflation tax revenue; 3) Earnings from [issuing] debts; 4) Overseas investment income; 5) Fee income from dollar transactions; 6) Unfair trade gains; 7) Currency manipulation of earnings; 8) Financial derivative gains; 9) Returns from big item Commodity futures; 10) Income from intellectual property.
Source: Qiushi Journal, February 6, 2015