Meet the System That Will Collapse the U.S. Dollar-Part 1
BY JERRY ROBINSON
Over the last few articles, I have explained the reality of peak oil. However, this is just one factor of America’s looming energy crisis. Another major component that is vital to understand is something known as the breakdown of the Petrodollar system. Today, I will begin explaining exactly what this system and why you should understand it.
In the early 1970’s, the international gold standard had collapsed, and America was beginning to live far beyond its means. And despite facing unemployment and inflation, America displayed few signs of the kind of fiscal discipline that could prevent future complications. But just like today, fixing the root of the problem was not the concern of Washington. Instead, the primary concern of those governing America was how to maintain its position of economic dominance on the global stage. In order to ensure continued hegemonic power and thereby preserve an increasing demand for the dollar, Washington needed a plan. That plan came in the form of the petrodollar system.
But what exactly is the petrodollar system? First, let’s begin by defining the “petrodollar.”
A petrodollar is a U.S. dollar that is received by an oil producer in exchange for selling oil. It’s really that simple: Money – in our case, U.S. dollars – received in exchange for oil.