Bush’s Dollar Drop Maps Loss of U.S. Clout at Final G-8 Summit

James G. Neuger
Bloomberg
June 3, 2008

When President George W. Bush went to his first Group of Eight summit in 2001, a dominant issue was the dollar — the strong dollar, that is. The U.S. currency was on a record-setting streak, and the free-marketeering president wasn’t going to stand in the way.

On the eve of Bush’s last G-8 appearance, the dollar’s gyrations are again in the crossfire. This time, it is a weak currency, upended by slumping growth, a housing recession and record gas prices, that is gnawing away at the world economy.

The dollar’s 41 percent drop against the euro during Bush’s term writes the economic epitaph of an administration that set out to restore American preeminence. Instead, Bush heads to Japan next week for his final international summit with diminished leverage as Russian and Chinese influence grows.

“Between the economic duress facing the United States and the global community at large and the fact that the clock is running out on the Bush administration, Bush does not hold a good hand,” said Charles Kupchan, an international-relations professor at Georgetown University in Washington. He called the summit a “damage-limitation” exercise to show the world that governments are trying to contain food and oil prices.

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