Strengthening the Dollar Amid Economic Warfare: How the U.S. Can Protect Its Financial Sovereignty Against Global Threats

By Stephen Zogopoulos. USNN World News

The U.S. dollar has long been a global powerhouse, acting as the world’s primary reserve currency, an asset that lends unmatched economic strength to the United States. However, in recent years, economic aggression has become a growing threat, with China, Russia, and certain Middle Eastern countries seeking alternatives to the dollar for global trade—an effort to undermine the dollar’s dominance and, by extension, America’s economic influence. This strategy, if left unchecked, could weaken U.S. influence and potentially provoke further proxy conflicts, a familiar method used by adversaries to undermine U.S. interests indirectly.

The Importance of Defending the Dollar

Historically, no country has attacked the U.S. directly on its own soil, primarily due to America’s military might and the sheer resolve of its citizens, many of whom have served as veterans in prior conflicts. Instead, adversaries engage in economic warfare, recognizing the high costs of direct confrontation with the U.S. military. By destabilizing the dollar and encouraging trade in alternative currencies like the Chinese yuan, these countries seek to chip away at American economic power, thereby weakening our national defense capabilities and influence abroad.

To counter this, the U.S. must consider bolstering the dollar’s position through a combination of financial and technological strategies, including the potential for a U.S.-backed digital currency. Such a currency could preserve our financial sovereignty, providing a digital asset that could operate in both national and international markets without the constraints and vulnerabilities of traditional currency systems.

Proxy Wars as a Form of Economic and Political Warfare

In addition to direct economic actions, proxy wars continue to serve as tools of indirect aggression. The current war between Israel and Hamas is an example. Iran, using its financial resources and influence, funds organizations like Hamas and Hezbollah to destabilize the region, leveraging these groups to wage war by proxy. Here’s a breakdown of current proxy conflicts, the nations involved, and their objectives:

1. Israel-Palestine Conflict
   • Actors: Israel, Iran (via Hamas and Hezbollah), various Gulf states.
   • Goals: Iran seeks to challenge Israel’s sovereignty and erode U.S. influence in the region by supporting anti-Israeli factions. For Israel, maintaining its borders and securing its people from terrorist threats remains paramount, with the U.S. firmly in support.
2. Russia-Ukraine Conflict
   • Actors: Russia, Ukraine, NATO (with heavy U.S. involvement).
   • Goals: Russia’s primary objective is to expand its territorial control and reassert dominance over former Soviet states, undermining NATO’s influence in Eastern Europe. The U.S. supports Ukraine to maintain stability and discourage further Russian expansion.
3. Yemen Conflict
   • Actors: Saudi Arabia, Iran (via Houthi rebels), UAE.
   • Goals: Iran’s support of the Houthis is designed to counter Saudi influence in the Arabian Peninsula, weakening a key U.S. ally in the region. For Saudi Arabia, securing its borders and maintaining its leadership in the Gulf region are central goals.
4. Syrian Civil War
   • Actors: Syrian government (supported by Russia and Iran), Syrian rebels, Turkey, the U.S., and ISIS factions.
   • Goals: Russia and Iran back the Assad regime to solidify their influence in the region and maintain strategic military footholds, including bases. The U.S. aims to counter ISIS and reduce Assad’s brutality against civilians while countering Russian and Iranian dominance.
5. Taiwan Tensions
   • Actors: China, Taiwan, the U.S.
   • Goals: China seeks to assert full control over Taiwan, bringing it under mainland governance to bolster its territorial claims in the South China Sea. The U.S. provides support to Taiwan, viewing its autonomy as critical to countering China’s influence and safeguarding key trade routes.

Steps the U.S. Can Take to Counter Economic and Proxy Threats

To prevent the U.S. dollar from being sidelined in international markets and to avoid being drawn into further proxy wars, the U.S. should consider the following strategies:

1. Enhance Dollar’s Appeal Through Digital Currency Innovations
   A U.S.-backed digital dollar, established through secure and transparent blockchain technology, could allow the dollar to operate within digital ecosystems that support fast, efficient international transactions. This move would counter efforts by countries like China, which has already begun trialing its digital yuan in various trade agreements. Such a step would secure the dollar’s place as a relevant and adaptive global currency.
2. Expand Energy Independence to Stabilize Oil Prices
   Ensuring a consistent domestic supply of energy—especially oil and gas—would reduce America’s reliance on international oil markets dominated by OPEC, whose shifting priorities sometimes undermine U.S. interests. Further investment in renewable energy sources could also serve as a countermeasure, safeguarding American energy security and reducing vulnerabilities in global energy pricing.
3. Strengthen Trade Alliances with Economies Relying on the Dollar
   By reinforcing trade ties with partners who favor or rely on the dollar, the U.S. can create economic incentives for those countries to continue supporting the dollar over other currencies. A strategic mix of economic aid, favorable trade policies, and cooperative agreements with dollar-centric economies could act as a robust shield against efforts to sideline the dollar.
4. Intelligence and Cybersecurity Measures Against Financial Attacks
   With the rising sophistication of cyber warfare, the U.S. should invest heavily in digital defenses to protect the financial systems underpinning the dollar. Preventing cyber attacks on banks, stock exchanges, and currency exchanges could preserve the dollar’s integrity and ensure that alternative currencies don’t gain an advantage through illicit means.
5. Contain Proxy Threats Through Diplomatic Pressure and Aid
   Recognizing that these proxy wars drain U.S. resources and attention, America can build diplomatic and intelligence-gathering capabilities to reduce the chance of these conflicts growing into larger engagements. Financial aid to allies engaged in these conflicts can act as a buffer without requiring direct U.S. involvement, saving American resources while supporting partners on the ground.

Final Thoughts

America stands at a crossroads where the traditional dominance of the dollar faces unprecedented challenges. From digital currency advancements to economic reforms, the U.S. must act decisively to reinforce its financial sovereignty. At the same time, it’s crucial to address the rise in proxy warfare, ensuring that America’s military, intelligence, and economic strategies are robust enough to navigate these turbulent waters without falling into the traps set by adversaries. By shoring up the dollar and remaining vigilant against proxy wars, the U.S. can continue to hold its ground on both the economic and geopolitical fronts.

Disclaimer: This article reflects the opinions of Stephen Zogopoulos of USNN World News. The ideas presented here are speculative analyses based on recent global developments and do not constitute financial or military advice.