Trump, against the Dollar

The erosion of U.S. institutions can affect the dollar as a major currency.

As the U.S. presidential election on Nov. 3 draws near, political uncertainty is increasing, adding to the great unknown that looms over the global economy. Contributing to this is the disastrous management of the White House’s COVID-19 pandemic response and the severe consequences it is leading to in terms of job loss and impoverishment of segments of the population. However, nothing is as unsettling for everyone – not only U.S. citizens, as the irresponsible and authoritarian behavior of their president who even presumes to question the legitimacy of the election date, though he has zero legal precedents on his side. All of this comes after he refused to make good on his promise that he would accept the results if they were unfavorable to him.

Trump knows now that securing a second election victory will be very difficult and is willing to do anything other than succumb to defeat. His current aim is to reverse the effects of the pandemic, which have significantly damaged him politically due to his frivolous response and irresponsible dismissal of the facts, and turn it into a pretext to restrict the right to vote. The focus of his attention is to reject or limit as much as possible the eventuality of mail-in voting. Mail-in voting is the only system that could prevent an election-defining low voter turnout for the Democrats if the states’ infections continue to rise, as is likely to be the case. The prospect of an election tainted by lengthy vote recounts and court appeals to prevent a clear-cut victory, and the timely handover of the presidency is worrying.

The erosion that the institutions of the great American democracy are undergoing is stretching far beyond what anyone could have imagined when Trump won. The dollar is also suffering the effects of the Trump storm; as a result, fears are beginning to mount regarding its ability to continue as a major currency and safeguard against global crises. As things stand, it seems inevitable that these fears will increase if Trump remains in the White House for four more years.