US Will Kill Dollar Global Reserve Status By Giving Russian Assets to Ukraine

The United States is willing to sacrifice the US Dollar in order to not appear to lose to Russia in Ukraine, despite the catastrophic consequences, Mark Sleboda, an analyst for security and international relations told Sputnik’s Final Countdown on Friday.

“I think the threat [to give frozen Russian assets to Ukraine] is real,” Sleboda told hosts Angie Wong and Ted Rall. “I think rather than admit defeat to Russia in Ukraine, they absolutely will do something like this. I don't think that this is posturing. I think they're seriously considering it, despite the damage it could do to the US and the global economy down the line, because this is that important to them. They believe that their hegemony is on the line here.”

Sleboda says that by taking assets that are legally Russia’s and giving them to Ukraine, the US government will cause international trust in the dollar, currently the world’s largest reserve currency, to plummet and encourage them to diversify their holdings.

“Other countries will say, ‘well, the dollar is no longer a reliable global reserve currency’ if the US can just seize somebody's money, whenever [they] have geopolitical problems with them. That breaks the terms of the global financial and economic system that was set up by the US and the West starting all the way back with Bretton Woods in the 1960s,” Sleboda said, noting that by simply freezing the assets, the US already encouraged this process to begin, pointing to Saudi Arabia which has been looking for alternatives to the petrodollar.

“When that happens, then $30 trillion-plus of US national debt becomes suddenly real and that could have severe economic effects, not just on the United States but the whole world,” Sleboda argued.

Much of the inflation that should come from the trillions in US debt is counteracted, many economists say, because of its status as the global reserve currency. When the US borrows money from foreign countries, they hold that debt for future international transactions, including transactions with other countries besides the US. That process prevents the cash from hitting the street and increasing inflation.

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But, the US is willing to risk its global economic hegemony if it believes it might save its global military hegemony, noting that the $300 billion in Russian assets held by the United States would be enough to fund the Kiev regime for years.

“They're talking about $61 billion from the US for one year. So, even if not all of it is stolen - because that's what it would be, theft. Then that could fund the Kiev regime's economy, which is entirely dependent on the West to a tune of some 50 to $60 billion a year, plus their military expenses on top of that. So it is a considerable sum of money.”

However, Sleboda notes that Russia could respond in kind, putting an end to the global economic rules that have held sway over the globe for decades.

“Boom, [Western assets in Russia are] gone. Russia already made that clear. If the US and other Western countries do that, they will seize every Western asset by companies, by private individuals. Anything they can seize in Russia, they will seize,” Sleboda explained. “And then we are in a whole new, I mean, the rules of the global economy that have existed certainly for the last 30 some years, but really, for the last 70 years could all come crashing down. And what starts with Russia could easily spread once you open this genie's bottle, it's hard to put it back in.”

But Sleboda says the United States under the Biden administration is likely willing to take that risk. “I can't stress to you how important they feel not being seen as losing to Russia in Ukraine is.”

US Will Sacrifice the Dollar if It Hands Russian Assets to Ukraine