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Haha, what could go wrong.
(hexbear.net)
https://www.cnn.com/2023/10/23/business/javier-milei-argentina-dollerization-explainer/index.html
Such a move would effectively disband Argentina’s central bank, handing the reins of monetary policy — that is, the power to set interest rates and print more money — over to the US Federal Reserve. The Fed would continue to set the cost of borrowing based on the needs of the US economy, not Argentina’s.
Milei has argued that surrendering autonomy to Washington is a necessary step to instil discipline into Argentinian policymakers. It would mean Argentina would no longer be able to print money.
Forgive my naivety, but why must countries repay the dollar debts in kind? Can't they mutually agree to repay in yuan?
Another point, if America further deindustrialized, isn't that a net advantage for China? It doesn't matter if America reaps all the rewards of treats produced in the global south, the outcome is that the means of production are not with them.
This question is how are they going to find the yuans in the first place? China wants to be a net exporter country and run a current account surplus, which means unlike the US dollar, there is never going to be enough yuans floating around for everyone to store as reserve currency, and this means the only way to earn those yuans is to export your goods and commodities to China. But as I have said, since China wants to be a net exporter country, you are also directly competing with Chinese industries and workers - why would China buy your stuff instead of their own?
America doesn’t have this problem because it is a net importer country and runs a current account deficit. It can keep “printing” dollars as needed to import stuff, which also means a vast liquidity for others to store as a reserve currency. This is why many countries decided to take on the loans in dollar in the first place.
This is not to say there aren’t loans in yuan, there are but not nearly enough to challenge the deep investment market of the dollar.
The answer to this is ideological in nature. America believes that it can retain its hegemony simply through financial means while fully deindustrialized, whereas China believes that the means of production that produces tangible goods/services (industrial capital) is the real stuff that matters.
As Michael Hudson has always said, the conflict between US and China is not so much a geopolitical conflict but when understood at a higher level, an ideological one between finance capitalism and industrial capitalism, and only the latter could create the conditions to transition into socialism.
This is where the battle lines are being drawn as the US and China ramp up toward their ultimate showdown. I cannot tell you which side will prevail but we will likely find out the answer in our lifetime.