Economic historian Phillip Magness wasn’t expecting to go viral last week when he posted a clip of Vice President JD Vance criticizing the US dollar’s status as global reserve currency.
While researching tariffs, Magness unearthed 2023 footage of Vance telling the populist group American Moment that he’s “not sure” it’s “actually good” that dozens of foreign central banks store their reserves in dollars. The then-senator called reserve-currency status “a resource curse” like “coal in Appalachia” because it allows “consumers to consume very cheaply.”
Magness shared that video on X, followed by another clip in which Vance says that forsaking reserve-currency status could allow the US to “make enough weapons” to help Ukraine. Now “it’s all over the place,” he told Semafor: “I’m shocked.”
A self-described “critic” of Vance on trade, Magness is something of a libertarian gadfly among MAGA economists. But for allies of a vice president who’s uniquely willing to feed his online trolls, Magness struck a nerve by elevating Vance’s comments that the dollar’s reserve-currency status could be hurting the US’ ability to export goods.
Vance’s backers sense a growing campaign by free-market Republicans to discredit his economic policies ahead of a potential 2028 presidential bid — even as they double down on their concerns over the dollar’s reserve-currency status, later embraced by former Trump White House Council of Economic Advisers Chair Stephen Miran.
“The fact that you still have this bizarre kind of rump-libertarian right that thinks it’s … absurd mostly just speaks to how far behind the contemporary issues they really are,” Oren Cass, founder of the populist-conservative group American Compass, told Semafor.
Yet even as he derided Magness’ critique as “half-baked and pathetic,” Cass acknowledged that “it clearly is starting to kind of lay out some of the contours for the conflicts that are going to emerge in the Trump administration over what right-of-center economic policy and thinking looks like in the future.”
Vance, who will travel to his home state of Ohio for a Friday speech on the economy, hasn’t explicitly called for displacing the dollar as reserve currency — nor is he in a position to act on it. His office did not comment for this story.
Importantly, his boss has vowed to protect the dollar’s reserve-currency status despite occasionally paying lip service to the related benefits of a weaker dollar, instead prioritizing tariffs aimed at boosting US exports.
President Donald Trump’s second-term administration has shown little appetite for deterring foreign central banks from holding their reserves in dollars, indicating that officials “may have been persuaded not to go that way over time,” Harvard University professor Kenneth Rogoff, author of “Our Dollar, Your Problem,” told Semafor.
Vance’s economic identity as the Republican presidential frontrunner for 2028, however, remains unclear. He spent his time on Capitol Hill flexing populist bona fides, teaming up with progressives as he touted proposals to penalize bank executives and rein in credit card companies (even if he later cooled on the latter).
That track record added weight to Magness’ posting spree.
“Welcome to the big leagues: If you’re going to run for president, your past statements are going to be scrutinized,” said Magness, adding that Vance’s Senate aides posted the vice president’s comments themselves.