The surplus dollars pouring into the rest of the world for yet further financial speculation and corporate takeovers is forcing foreign central banks to bear the costs of America’s expanding military empire.
Keeping international reserves in “dollars” means that when U.S. deficit payment pumps “paper” into foreign economies, these banks have little option but to recycle it into U.S. Treasury bills and bonds ‑—which the Treasury spends on financing an enormous, hostile military build-up to encircle the major dollar-recyclers China, Japan and Arab OPEC oil producers. These governments are forced to recycle dollar inflows in a way that funds U.S. military policies in which they have no say in formulating, and which threaten them more and more belligerently. China and Russia have consequently taken the lead in forming the Shanghai Cooperation Organization to reduce military hostilities in their region.
To date, countries have been powerless to defend themselves against the fact that this compulsory financing of U.S. military spending is built into the global financial system. Neoliberal economists applaud this as “equilibrium,” as if it is part of economic nature and “free markets” and a vote of confidence in US policies, rather than bare-knuckle diplomacy wielded with increasing aggressiveness by U.S. officials. The author notes that European and Asian public are keenly aware of this, “The only people who seem not to be drawing this connection are the American mass media, and hence public.”
“Economic Meltdown: The “Dollar Glut” is What Finances America’s Global Military Build-up” Prof. Michael Hudson, Global Research, March 29, 2009 http://www.globalresearch.ca/index.php?context=va&aid=12944