Professor Brands highlights the dollar’s dwindling power

Sarah White

According to Pulitzer Prize finalist and UT history professor H. W. Brands, the United States dollar has dominated the world economy in the past, but a continuation of its historical strength may not be realistic today.

Brands took the stage in the former Austin City Limits studio on Tuesday to speak about the “Past, Present and Future of the American Dollar.” His lecture was part of the Game Changers series hosted by the Office of the President and the Longhorn Network.

Brands spoke on the historical background of the American dollar and its successes and failures from 1792 to the present.

“Money is the grease that makes the economy function,” Brands said. “The ideal money system grows at the rate of the economy. However history shows that this is very difficult to accomplish.”

Brands said he expects the dollar to eventually be replaced as the dominant currency by a collection, or “market basket,” of national currencies.

He said in the past other nations have based their currencies on the dollar as the standard, and this was viable because the U.S. economy had been stronger than the economy of the rest of the world combined.

“If you have the strongest economy, you can dominate global policy,” Brands said. “However, the American economy is no longer the sole lynch-pin in the
global economy.”

Brands said parallels exist between the financial crises in Europe and the financial crisis in the United States. He said that new pensions for government workers and expanded spending plans could cause a financial collapse in the United States similar to the one in Greece.

“The best possible outcome of the current global economic uncertainty is that there is a narrow resolution and global economies begin to get their fiscal affairs in order,” Brands said.

The lack of a central political body in the European Union could be part of the reason for the European crisis, he said.

“Looking to the future, there is the possibility of a world currency but in order to be effective, it must be connected to a central political body,” he said.

The Game Changers series is a monthly show that focuses on varying academic topics, including politics and science as well as history, said Kathleen Mabley, director of Brand Initiatives, a program within the Office of the President concerned with representing the image of the University.

“Part of the reason that we chose Brands is because he has written 22 different books and conducted incredible research which he incorporates into his teaching and writing,” Mabley said.

The lecture series was part of a University attempt to give students, alumni, staff, faculty and fans greater access to the academic and intellectual exchanges that take place at UT, Mabley said.

Longhorn Network representative Don Colantonio said the network will televise the series. Ten percent of the content on the network is non-sports, meaning academic, cultural and campus life programing, he said.

Colantonio said the Longhorn Network was pleased to have this opportunity.

“This gives us a great platform for showcasing the prominent and accomplished faculty on the network,” Colantonio said.

Printed on Wednesday, October 19, 2011 as: Dominance of dollar unsure, Brands notes