The Bush Administration has been depending on the falling dollar to boost American exports and dampen imports in an effort to moderate our huge national debt. Remember, when the dollar falls, exports grow because our goods become cheaper overseas, and imports decline because imported goods become more expensive. We sell more of our stuff and buy less of theirs. The huge debt has been a cause of great concern among quite a number of non-politician economists because our government is paying daily expenses through indebtedness -- kind of like paying your rent and your utility bills on credit cards which you can't pay off every month. The conservative stance has been to argue that it isn't really a problem because our dollar is so strong and we are so important that we can keep going like this for quite awhile. The stance from The Other Sides has been that large indebtedness is okay periodically if it is used to stimulate the economy in down times, to build infrastructure which also would stimulate the economy, or to pay for time limited expenses like war (hopefully time-limited). They have argued that if other countries start to lose confidence in the dollar and start to replace their dollar reserves with Euros, say, it would weaken the dollar to the point that we could start to have really serious problems with an unsound currency. That is, for example, we would need more and more and more dollars to pay off other countries who now hold considerable quantitities of our debt. China and Japan come to mind. Under normal circumstances, or maybe we should say relatively stable circumstances, countries don't "call in" other supposedly economically sound countries' debt like repo men, but if they lost confidence in us, or for that matter they wanted to see us decline, they could. An example on a small scale basis: If you borrowd fifteen thousand dollars from someone in Europe six months ago, today you would owe her close to twenty thousand dollars.
Here is a link to today's New York Times which indicates that some players on the international scene are beginning to do just what economists on The Other Sides fear. It also discusses the Administration's continuing failure to undertake problems that really matter and o make worse what was bad before.
Here is a link to an op-ed piece in the Times putting a pin very close to the Alan Greenspan bubble -- the bubble in which live Administration optimists. http://www.nytimes.com/2005/03/10/opinion/10grant.html