In July, the 70th anniversary of the founding of the International Monetary Fund (IMF) and World Bank, an alliance of leaders from Brazil, Russia, India, China and South Africa (BRICS), announced the creation of the $100 billion New Development Bank (NDB).

The BRICS, a group of rising imperialists challenging US imperialism, aim for the NDB to start lending in 2016.  It will be headquartered in Shanghai, China, which will provide the largest share of capital.  This comes as anger among rival imperialists mounts over the dollar's dominance in lending and trade.

The NDB was formed to compete with the IMF and World Bank, which have controlled international trade since they were created at the Bretton Woods Conference in 1944, when the US, as a result of WWII was becoming the top imperialist power.  The conference established the dollar as the world's reserve currency. In the 1970's the US forced OPEC to sell all its oil in dollars, creating the petrodollar and making every country trade in dollars. The BRICS are taking aim at the dollar and petrodollar's reserve currency status.

With the dollar as reserve currency, any country trading internationally had to use it.  This gave the US great advantages over its rivals. The world's most important commodities, especially oil, have been priced and traded in dollars, even though most of them are not produced in the US. This has allowed the US Federal Reserve to print money and export inflation to other countries while the Federal Government runs a huge deficit.

Capitalism makes war inevitable

The NDB is only part of the growing challenge to US hegemony, part of the imperialists' fight to the death for world domination which will result in world war.  The next world reserve currency will be decided, as in the past, by murderous world war.

Russia and Iran's attack on the petrodollar, along with declining US market share, have led to more international financial transactions taking place in euros, yen, and yuan, rather than dollars. Iran sells oil in a combination of euros, yuan, yen, gold, and goods. The euro and the dollar have been exchanging the top spot for most international financial transactions since last year.

US Disciplining of France Backfires

The struggle is sharpening. For example, the US recently levied an unprecedented multi-billion dollar fine against French bank BNP Paribas, for secretly violating US sanctions against Sudan, Cuba and Iran. Christian Noyer, governor of the French National Bank, said that the result of this case will be to encourage "diversification" from the dollar, that it is "inevitable" that "trade between Europe and China does not need to use the dollar and may be read and fully paid in euros or renminbi (yuan)."

This ruling was actually a US attempt to pressure the French government to cancel the delivery of Mistral amphibious warships to Russia, but it backfired.  Instead, the French delivered the ships and have accelerated the movement in Europe toward a multi-polar policy away from the dollar.

Putin's response to US sanctions over the Ukraine has been to sell more Russian-held US treasuries and move away from the dollar, while encouraging transactions among the BRICS to take place in local currencies. Most importantly, Russia has begun selling oil to China in yuan and plans to sell it to Europe in rubles. On August 27, Gazprom sent a huge shipment of oil to China in exchange for yuan.

As the pressure on the dollar accelerates, the US imperialists' position is becoming become more desperate. They will ramp up even more their attacks on US and other workers to prepare for wider wars and world war, to defend their declining empire and dollar. They and their capitalist-imperialist rivals will resort to more patriotic appeals for military recruitment and workers' loyalty to slave in their arms factories.

We Need Communism, Not Currency

Workers around the world have no stake in the crisis-ridden capitalist system heading toward a genocidal world war to decide which imperialist and currency will rule over us.  Money was created to mask the bosses' theft of the value produced by workers' labor power, their wage slavery, and to facilitate buying and selling the things workers need to live.

Masses of workers, soldiers and youth must mobilize to turn the bosses' deadly competition and war into a communist revolution. In communism, the masses will mobilize to produce everything we need, nothing will be bought or sold and there will be no wage slavery. We have a world to win by mobilizing to get rid of all currencies and producing only for our needs.

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