Who to blame for the falling value of the dollar?

Question

Since Section 8 of the US Constitution states:

Congress shall have power:

To coin Money, regulate the value thereof, and of foreign coin, and to fix the standards of weights and measures;

Shouldn't we be blaming the Democrat controlled congress for the falling value of the US dollar. Didn't the dollar start to fall shortly after democrats took control in Jan, 2007?

Please answer the question, is it not the congress responsibility to control the value of the dollar? Why has the valur of the dollar fallen since democrats took control of congress?

Answer 1

The blame can be laid on those that took the dollar off of a real value and made it a "fiat" system.

It no longer has a fixed value in any way. So, any negative events can effect how the dollar is valued.

Answer 2

The dollar has been falling against the Euro since 2002. Hardly something which the "Democrat controlled congress" can be blamed for.

The fall of the dollar can more sensibly be blamed on a few things:

(1) Huge government deficits as a result of the Iraq war.
(2) The American people's love for imported goods, resulting in a substantial trade deficit (the US imports a lot more than it exports)
(3) The prospect of the Euro taking over as the world's "reserve currency" reducing the demand for USD in foreign coffers).

The proximate cause, however, is the trouble banks have gotten into with bad housing loans. The Federal reserve, rather than just letting Countrywide, Citi, and all those others go bankrupt, helped them out by lowering the fed funds rate target, so they could borrow short-term money more easily to get through the crisis. This meant that rates were lower in the states than other countries, so investors moved their money out, selling USD and buying other currencies to do so.

Some people have the habit of blaming whatever bad happens in the economy (or whatever bad happens in general) on their least favorite political party, but that is really a distraction. If the US was a major exporter of goods and services, its dollar would go up. Since it is a major importer, its dollar goes down. No act of congress would change that.

Congress can, however, take action to reduce the government deficits, which hopefully will happen once congress gains enough support to prevent the needless spending of money on the war.

Answer 3

While it's true that the dollar is falling in value, you really can't blame the Democrats since taking office in Jan. 2007.
You have to go back and see the damage this PRESENT Admin. has done till now (the War, bad economic decisions, trying to screw up S. S., blank check spending, etc).
Believe me, the dollar hasn't 'just' fallen since Jan. 2007, it's been a long time coming!

Answer 4

It is the flow of foreign investment dollars (the capital account) into the U.S. economy that drives the trade deficit. The U.S. economy's higher return on capital than Europe or Japan for the last 20 years caused private foreign investors to buy U.S. stocks and bonds and other assets. In addition, foreign governments, particularly of China, Japan and other Asian states, have steadily increased their purchases of U.S. dollars as reserve backing for their own currencies

It has NOTHING to do with the Democrats in Congress

Answer 5

There are so many factors. But the Congress really doesn't have much power to control it. The federal reserve has far more power then the Congress. In my opinion, the yearly deficit is the main reason.

Answer 6

The Republican controlled Congress and White House are to blame. They created the nine trillion dollar National Debt. That's the reason for the dollar being worth so little today.

Answer 7

Bush Bush Bush

Answer 8

This administrations insane spending you know that bush ran his oil businesses into the ground all of them before setting his sites on the white house.

Answer 9

Nope. It's Bush's war spending.

Answer 10

NEWS LIKE THIS CERTAINLY CAN'T HELP MONEY MATTERS, CAN IT? --

Prominent Mississippi trial lawyer Richard "Dickie" Scruggs, who has fought insurance companies over payments for damage caused by Hurricane Katrina, was indicted yesterday on charges of bribery. Scruggs is the brother-in-law of Sen. Trent Lott (R-MS), who recently announced he would retire before the end of the year. The indictment accuses Scruggs of using an associate, Timothy Balducci, to bribe Mississippi Judge Henry Lackey to secure a favorable ruling in a lawyers' fees dispute. The 13-page indictment quotes Balducci telling Lackey about Scruggs: "[H]e and I, um, how shall I say, for over the last five or six years there, there are bodies buried that ... he and I know...where [they] are, and my trust in his, mine in him and his in mine, in me, I am sure are the same." According to the indictment, Balducci made three cash payments to Lackey between Sept. 27 and Nov. 1, 2007, telling Scruggs's son Zach, "We paid for this ruling; let's be sure it says what we want it to say."

Richard F. Scruggs, a prominent trial lawyer who has been fighting insurance companies over payments for damage from Hurricane Katrina, was indicted yesterday by federal authorities on charges of offering a bribe of $50,000 to a Mississippi state judge in a dispute over fees with another lawyer.

The indictment, filed in federal court in Oxford, Miss., Mr. Scruggs’s hometown, said that on behalf of Mr. Scruggs, a colleague met several times this year with State Judge Henry L. Lackey in his chambers in Calhoun County to propose and deliver the bribe in installments.

Mr. Scruggs’s son Zachary, who is a partner in the Scruggs Law Firm in Oxford, and Sidney A. Backstrom, another partner, were also indicted, as were Mr. Scruggs’s colleague, Timothy R. Balducci, a partner in the firm of Patterson & Balducci, and Steven A. Patterson, a staff member in the firm. Mr. Scruggs, his son and the others were all accused of conspiracy.

Prominent Mississippi trial attorney Richard "Dickie" Scruggs, the brother-in-law of outgoing GOP Sen. Trent Lott, was indicted by a federal grand jury Wednesday on charges that he and four other men tried to bribe a Mississippi state court judge.

According to the 13-page indictment, Scruggs and three other attorneys -- including Lott's nephew Zach -- attempted to bribe Mississippi Third Circuit Court Judge Henry L. Lackey with at least $40,000 in cash.

Lackey was assigned to hear a lawsuit in which Scruggs' firm was named as a defendant in a dispute involving $26.5 million in attorneys' fees stemming from a court settlement with State Farm Insurance over Hurricane Katrina claims.

The indictment alleges that the bribe was intended to resolve the case in Scruggs' and his firm's favor. Also charged was Sidney A. Backstrom, an attorney at Scruggs' firm; Timothy R. Balducci, a New Albany, Miss., lawyer; and former State Auditor Steven A. Patterson, an employee of Balducci's law firm.

Lott, the second-highest ranking Republican in the Senate, announced Monday he was resigning his seat after 35 years on Capitol Hill. Lott's decision to leave Congress came one year after he won re-election to his fourth term.