Dollar hegemony was secured by deliberately suppressing American working-class wages

Evidence

But there was another reason why the dollar’s hegemony grew: the intentional impoverishment of America’s working class. A cynic will tell you, quite accurately, that large quantities of money are attracted to countries where the profit rate is higher. For Wall Street to exercise fully its magnetic powers over foreign capital, profit margins in the United States had to catch up with profit rates in Germany and Japan. A quick and dirty way to do this was to suppress American wages: cheaper labour makes for lower costs makes for larger margins. It is no coincidence that, to this day, American working-class earnings languish, on average, below their 1974 level. It is also no coincidence that union busting became a thing in the 1970s, culminating in Ronald Reagan’s dismissal of every single unionised air traffic controller – a move emulated by Margaret Thatcher in Britain who pulverised whole industries in order to eliminate the trades unions that inhabited them. And faced with a Minotaur sucking most of the world’s capital into America, the European ruling classes reckoned they had no alternative but to do the same. Reagan had set the pace, Thatcher had shown the way. — Yanis Varoufakis, Technofeudalism, 199

Categorization

• XREF: connects to: Global wage suppression was engineered to boost dollar profit rates — Yanis Varoufakis, Technofeudalism: What Killed Capitalism, 199; Stabilizing currency deliberately imposed the costs on workers. — Clara E. Mattei, The Capital Order: How Economists…, 983; US financial-military hegemony structured the postwar Fordist world economy — David Harvey, The Condition of Postmodernity: An…, 825 (+4 more)

Broader Connections

• Global wage suppression was engineered to boost dollar profit rates #corroborates (0.95) — Yanis Varoufakis, Technofeudalism, 199
• Stabilizing currency deliberately imposed the costs on workers. #corroborates (0.88) — Clara E. Mattei, The Capital Order, 983
• Experts recognized wage-cutting as the crux of class conflict over monetary policy #corroborates (0.82) — Clara E. Mattei, The Capital Order, 966
• The Nixon Shock converted dollars into hegemon-controlled IOUs #expands (0.78) — Yanis Varoufakis, Technofeudalism, 559
• US financial-military hegemony structured the postwar Fordist world economy #expands (0.75) — David Harvey, The Condition of Postmodernity, 825
• Wartime state wage controls kept wages lower than free bargaining would have #qualifies (0.72) — Clara E. Mattei, The Capital Order, 179