The really sad thing about our world’s new “currency war” is how long it took for truly violent terms to be applied to this kind of behaviour in mainstream discussions. The fact that exchange rates and currency values have more to do with power and policy than actual relative values. If they did, we wouldn’t need measures like Purchasing Power Parity (PPP) – taught to first-year kids as a way to compensate for the gross distortion’s of the world’s currency markets .

By setting up the world’s exchange rates via the Foreign Exchange markets (one of the most lucrative white-collar gambling options ever), we lay the groundwork for a global commercial and financial empire. Nations like America, with highly overvalued currencies, are able to import huge amounts of foreign goods from countries like Mexico or China with undervalued money. It’s damn good for Wal Mart, and it’s pretty clear that governments on both sides have been working pretty hard to keep this state of affairs going – The American “Fed” by lowering interest rates, and the Chinese by investing heavily in American dollars. Worries about this have been at the centre of most critiques lobbied by the Anti-Globalization movement in the last 15 years, as well as many conservative critiques of trade policy, yet nothing has been done to stop the enormous trade deficits that ballooned in the background.

But while governments now bicker over who gets to dominate the cheap money & export business, the real world costs add up. Third World sweatshops don’t only hurt “privileged first-world workers”, they hurt the Third WOrld hardest of all. While business leaders and government officials do well, the workers and neighbours have to put up with the toxic side-effects. Much of the Niger Delta is now a toxic wasteland because of oil and gas development, Indonesia stands to lose most or all of its rainforests to plantation farming of palm and other crops. And of course, then there’s the American Rustbelt. This entire mess, though fantastically profitable for a few American businessmen, has been financed with decades of direct aid from American taxpayers to despotic, yet business-friendly regimes.

This war has been going on for decades. It’s claimed hundreds of thousands of lives in areas like Latin America, Africa and Indonesia, as well as seriously undermining the entire economy of the First World. The fact that it’s getting more press shows only that the stresses behind the scenes are getting a lot worse.