Monetary policies blamed for US woes

ISTANBUL — Severe corrosion in the United States' monetary policies, especially in recent years, has caused several problems in US society, a Turkish analyst says.

Murat Tufan, an analyst with the Turkish broadcaster Ekoturk, said the collapse of the middle-class population, increasing homelessness, a distorted health insurance system, difficulty in paying home loans and rising racism are just some of these problems.

Erroneous and inconsiderate policies of the US Federal Reserve have dragged down the middle-income groups in the US and the world, and it is a serious issue as millions of people have slipped into poverty, Tufan said.

"One of the most important reasons for the collapse of the middle class is that all countries have to use the US dollar as a reserve currency (as a medium of exchange)," Tufan said, referring to the use of US dollar across the globe.

When a country uses the dollar it experiences inflation because of the cost of using the greenback, he said.

The printing of trillions of dollars by the Fed, especially during the pandemic, is the biggest reason for inflation, he said. As a result, the income gap between the rich and the poor has widened so disproportionately that it cannot be reduced in a short period of time, he said.

Unfortunate picture

"Income inequality is an unfortunate picture for America, which is known as the world's largest economy," Tufan said.

"Many people in America are barely able to pay their mortgages. The health insurance system is also so tough. It's a huge challenge," he said, adding that the greenback's purchasing power has been falling rapidly.

He also noted that the US Constitution, which dates back to 1789, is "almost impossible to update", and has become the main reason for many problems in society.

"The Constitution was written primarily for landowners from the white male class and to protect their rights. But today humanity has changed, people's demands have changed, and the world has changed, but America's Constitution has not."

One of the crucial issues facing Washington is the debt ceiling crisis, he said. Next month the Senate will decide whether to raise the ceiling. If a solution cannot be found, the country will experience hard times.

The US government cannot print money to meet its needs, and some public institutions and organizations will be closed or have to work at low capacity.

Xinhua