Is the Sun Setting on America’s Financial Empire? | The Ezra Klein Show

Video Description

The U.S. dollar is the lingua franca of the global financial system. The fact that so much of the world relies on our currency has long been understood as our exorbitant privilege — the reason we have so much leverage in the global economy and are able to borrow at lower interest rates. But the Trump administration has a much more complicated relationship with the dollar. It has come to see dollar dominance as a burden we bear on behalf of the rest of the world. But in its attempts to move away from dollar dominance, is the Trump administration on the verge of creating a financial crisis? Kenneth Rogoff is a former chief economist at the International Monetary Fund and a professor of economics at Harvard University. He has a book coming out called “Our Dollar, Your Problem.” In this conversation he walks through the history of dollar dominance, why it’s been waning in recent years and what ripple effects the Trump administration’s policies might have. 0:00 Intro 2:27 The basics of dollar dominance 5:38 How the U.S. benefits 10:40 Effects on U.S. manufacturing 18:56 International perspectives 23:15 Trump’s threats to the system 32:00 Tariffs and the dollar 40:00 Can the damage be un-done? 48:55 Is a financial crisis on the horizon? 56:56 What could replace dollar dominance 1:01:14 Book recommendations Read the full transcript here: https://www.nytimes.com/2025/05/02/opinion/ezra-klein-podcast-kenneth-rogoff.html Watch more on @EzraKleinShow Thoughts? Guest suggestions? Email us at [email protected]. You can find transcripts (posted midday) and more episodes of “The Ezra Klein Show” at nytimes.com/ezra-klein-podcast. Book recommendations from all our guests are listed at https://www.nytimes.com/article/ezra-klein-show-book-recs.html