Yes, and like Europe built up the Euro to validate it for global payments, I wouldn't be surprised if China would push for the RMB to join the other two, unless they have a reason not to.
The truth is we can only be deficit free if our economy stops expanding. More or less permanent deficit spending is essential so long as the economy grows. Otherwise there will not be enough new outside money spent into the economy to supply our needs. Debating the rate at which deficits should grow is reasonable. But to argue against deficits, or worse to advocate repeated surpluses, so that the "debt" may be paid down, is absurd. The United States has no real debt.. The U.S. always money funds its deficit purchases. Deficit expenditures are paid with newly created money well before bonds are sold in net amounts matching deficits. These bond sales merely remove from the economy the newly created money spent into it via deficit spending and replace it with interest bearing money, i.e., bonds.
We need to do those things, but not because we need to be "deficit free". Deficits are the mechanism by which the amount of base money in the economy is expanded. We need more base money in proportion to the growth in the economy.
That and the fact that the government has no real debt. Certainly not in the sense that State and private sector debt is real.
That only works as long as there is demand for dollars which will be shrinking for different reasons long-long term. If there is no dollar demand there is no demnd for bonds and then - kaboom.
This is similar to my position, but I had it the other way round that the lack of demand to hold American Treasury bonds would lead to a lack of demand in the dollar to purchase them will. Either way a lack of investment into America will lead to the dollar falling, which is created by higher rates of taxation, high government debt and high government deficits.
The truth is ......... deficit spending is the illusion of a getting a free lunch. Every bill eventually HAS TO be paid. The mortgage meltdown was created by Wall Street repackaging toxic suuuuub prime tranches of mortgages. The Treasury Dept is doing the same thing only with U.S. Treasuries - considered the safest place to park your "money" - until one day they are not. Unfortunately, or rather fortunately, it will likely not come to a head before I leave this world so I will be denied the pleasure of laughing in the face of the Keynesian kool-aid drinkers.
No, debt has not to be repaid if it is inflated away. The truth is that with stagnating wages there is no true inflation which has made debt more severe in the recent years. But once ressources gain value as there is a shortage of it this will change.
The same is true without inflation with economic growth. If growth is created it will shrink the government debt as a percentage of GDP. This prevents the need to take any other action apart grom generating economic growth. In time the debt is shrunk proportionately to GDP to make it not matter.
True, when the Sun cools to 0 degrees Kelvin the dollar will be worthless. But why not talk about reality.