The newly designated US Treasury Secretary, Scott Bessent, acknowledged during his Senate hearing in Washington on Thursday that the excessive use of sanctions has eroded the dollar’s global standing. He shares this view with President Donald Trump.
Bessent emphasized the importance of finding flexible and strategic instruments to pursue national interests. He suggested that the US should maintain the dollar as a global reserve currency and use sanctions “cautiously” as part of a comprehensive approach to defending national security.
However, he also expressed willingness to support stricter sanctions against Russian oil companies if such a decision is part of Trump’s strategy to end the conflict in Ukraine. Bessent criticized the previous administration’s approach to sanctions, which he believed was hesitant due to concerns over rising energy prices ahead of the elections.
“The comprehensive sanctions program is ambitious: we need more US energy production to offset the loss of sanctioned Russian oil and protect the US consumer” Bessent said.
Regarding tariffs, he stressed the need for a flexible approach, citing three main goals: eliminating unfair trade practices, generating revenue for the federal budget, and using tariffs as a negotiating tool. Bessent believes that President Trump has added a fourth goal – using tariffs as a bargaining chip.
Furthermore, the candidate warned that the US may face an economic crisis and the largest tax increase in history if the Congress does not act quickly. In his opinion, Americans can expect a tax increase of four billion dollars if the situation does not change.