Bow to the dollar: How the U.S. attempts to destroy any country that drops its currency

Credit: (The Daily Beast/Google Images)

Written by: Aidan Jonah

In April 2018, Iran dropped the US dollar. Ever since, the country has been the target of even more relentlessly aggressive rhetoric and sanctions from the US.

However, these actions are far from unusual.

There is a strong historical correlation of US economic or military aggression against countries who drop the US dollar. This precedent began in Iraq during in the early 2000s, continued in Libya a decade later, and has hit its peak with the current targeting of the Iranian government.

Iraq’s implosion

In November 2000, Iraq announced that it was dropping the US dollar for the Euro to sell oil through their oil-for-food program. At the time, Iraq was on relatively good terms with the US, even with the completion of Operation Desert Fox in 1998.

The U.S. military website stated the purpose of that mission was to "to strike military and security targets in Iraq that contribute to Iraq's ability to produce, store, maintain and deliver weapons of mass destruction.” Given the success of that mission, Iraq would surely not come under fire for potential “WMDs” in the future.

After the 9/11 terrorist attacks on the World Trade Centre, US President George Bush accused Iraq of being part of an international "axis of evil" during his State of the Union address in Jan. 2002. He told Congress soon after, “Iraq continues to flaunt its hostility toward America and to support terror. The Iraqi regime has plotted to develop anthrax and nerve gas and nuclear weapons for over a decade … This is a regime that has something to hide from the civilized world.”

Multiple reports from UNMOVIC's Hans Blix and the IAEA's Director General Mohamed ElBaradei over the next year indicated that Iraq was not in possession of “WMDs”. Despite this Bush administration officials including Secretary of State Colin Powell insisted that Iraq had failed "to come clean and disarm.”

In March 2003, the U.S. military and other members of an American-led coalition invaded Iraq. A month later, President Bush declares an end to major combat operations on May 1. Shortly afterward, the Iraq Survey Group (ISG) was formed to search for WMD.

According to NPR, in October 2004, “the ISG released its final report and chief inspector Charles Duelfer testifies before congress about his team's findings. After 16 months of investigation, Duelfer concluded that Saddam Hussein had no chemical weapons, no biological weapons and no capacity to make nuclear weapons. This effectively ended the hunt for WMD.

Evidence eventually came out proving that the Bush administration always knew that Iraq had no WMDs.

The country was plunged into civil war for years as an armed insurgency fought back against the American invasion. At one point the US had 170 000 soldiers stationed in Iraq. Today there are 5200 soldiers, who will still not be withdrawn, despite the Iraqi parliament voting 170-0 to remove American troops from the country.

Libya: From riches to slave markets

In 2011, Libya was the African country that had achieved the highest progress on the Human Development Index, for which Muammar al-Gaddafi was about to receive a United Nations Prize.

In the years before, Gaddafi was working to create a new African Union, based on a new African economic system. He had a plan to introduce the ‘Gold Dinar’ as backing for African currencies, to allow them to escape the dollar-dominated western monetary system. At the time, Libya’s gold reserves were estimated at close to 150 tons, and about the same amount of silver. Their estimated value at that time was $7 billion.

After Wikileaks released over 3000 leaked DNC emails in July 2016, Vice focused on an April 2, 2011 memo prepared by ex-CIA official Sidney Blumenthal titled "France's client/Q's gold". It revealed France’s worry that Gaddafi’s move to a pan-African currency would undercut the currency guaranteed by the French treasury, known as CFA franc, that's widely used in France’s former West African colonies, and gives the French government insidious financial controls over those countries.

In March 2011, NATO led by French and American forces, begin their assault on Libya. By May, Gaddafi had been forced out of office and into isolation.

According to Timothy Bancroft-Hinchey of Global Research, “They [NATO] bombed the water supply, then bombed the factory producing tubes so that it could not be repaired, they strafed the electricity grid “to break their backs”, murdered Gaddafi’s grandchildren because they were classified as “legitimate targets”, murdered civilians, told lie after lie about the Government forces attacking indiscriminately when all they were doing was try to stem the onslaught of foreign terrorists shipped in to do NATO’s dirty work, orchestrated by NATO boots on the ground, in direct breach of UNSC Resolutions 1970 and 1973 (2011).”

NATO countries including the US, supported the National Transitional Council which sparked a civil war in Libya. On Oct. 20, 2011 Gaddafi was brutally killed in the Libyan coastal city of Sirte by soldiers from the NTC.

An IOM report in April 2017 revealed the presence of a live slave trade in Libya. In November, a CNN investigation revealed that migrants were being held in detention camps and auctioned off to the highest bidder.

Iran: From Revolution to Constant Fear

In 1979, the US-imposed Shah, Mohammad Reza Pahlavi, was removed from office by the Islamic Revolution. Ever since, the US has wished to overthrow Iran’s government.

In 2015, the Iran Nuclear Deal, referred to as the Joint Comprehensive Plan of Action, was a deal reached between Iran and: the permanent members of the United Nations Security Council—the United States, the United Kingdom, Russia, France, and China—plus Germany) and the European Union.

The BBC revealed that, in exchange for denuclearizing, sanctions previously imposed by the UN, US and EU were removed. Those sanctions were an attempt to force Iran to halt uranium enrichment, and crippled its economy, costing the country more than $160bn (£118bn) in oil revenue from 2012 to 2016 alone.

Under the deal, Iran gained access to more than $100bn in assets frozen overseas, and was able to resume selling oil on international markets and using the global financial system for trade.

US President Donald Trump had been threatening for years to withdraw the US from the Iran Nuclear deal, sparking Iranian fears of further sanctions.

In April 2018, Iranian state media revealed that Iran will start reporting foreign currency amounts in euros rather than U.S. dollars, in response to continued tensions with Washington.

On May 8th, Trump imposed sanctions on the Iranian oil sector which constituted the violation of the JCPOA. The US had pulled out of the Iran Nuclear Deal.

Over the next few years, Trump imposed crippling sanctions on all sectors of the Iranian economy. In particular, they have targeted the nation’s financial institutions.

A Human Rights Watch report released in October 2019, “Maximum Pressure: US Economic Sanctions Harm Iranians’ right to Health” lays out the devastation caused by US sanctions:

“Previously, the US government had lifted sanctions on non-US entities as part of the JCPOA. The serious regulatory and due diligence requirements placed on international firms trading with Iran have left only a limited number of companies and banks with the capacity to finance trade with Iran and willing to accept the increased financial and legal risks of US secondary sanctions that come with those transactions.

These restrictions on financing, combined with the sharp depreciation of the Iranian currency, the rial, have resulted in severely limiting Iranian companies and hospitals from purchasing essential medicines and medical equipment from outside Iran that residents depend upon for critical medical care.

Moreover, renewed US sanctions have directly impacted families’ purchasing power, contributing to inflation rates of around 30 percent in the past year. Iran’s nearly universal health care coverage currently absorbs a significant portion of health care costs. But the failure of this system, which is already under serious financial stress, will likely have devasting effects on millions of patients.

Current economic sanctions, despite the humanitarian exemptions, are causing unnecessary suffering to Iranian citizens afflicted with a range of diseases and medical conditions. Some of the worst-affected are Iranians with rare diseases and/or conditions that require specialized treatment who are unable to acquire previously available medicines or supplies. This includes people with leukemia, epidermolysis bullosa (EB, a type of disease that causes fragile, blistering skin), or epilepsy, and individuals with chronic eye injuries from exposure to chemical weapons during the Iran-Iraq war.”

On several occasions, US indicated that the harm sanctions are causing to ordinary Iranians are part of a strategy to compel Iranian citizens to demand their autocratic government to “change behavior.” It is an attempt to cripple the Iranian people so desperately, that they will rise up against their own government out of pure desperation.

HRW cited a CBS News interview with US Secretary of State Mike Pompeo who said, "things are much worse for the Iranian people [with the US sanctions], and we are convinced that will lead the Iranian people to rise up and change the behavior of the regime.” The US Treasury Department itself predicted that US policies would lead to Iran’s “mounting financial isolation and economic stagnation.”  

A Dangerous Future

With the recent assassination of top Iranian general Qassem Soleimani, tensions between Iran and the US have seemingly reached a fever pitch. This may seem like yet another spontaneous reaction to a crisis of the US’ own making. However, based on past US economic and military aggression against countries for dropping the US dollar, there is so much more to this story than most will know for years to come.