ABSTRACT
Many accounts of globalization/financialization tend to suggest that financial markets have both outgrown states and constrained states, limiting the autonomy of macroeconomic policy. However, these explanations are problematic as they fail to recognize the uneven and highly hierarchical quality of the global financial order. Further, some states are more privileged within this uneven financial order than others. Most significantly, the USA, which stands at the apex of the global financial order, has been able to run both massive current account and budget deficits with little if any constraint. This ability of the USA to run such deficits is not despite the expansion of global financial markets but precisely because of the development of these expansive markets. In fact, it is these global markets which allow the USA to draw in capital from all over the world. Moving beyond this apparent paradox of the world’s sole superpower as the world’s largest debtor requires understanding the unique power of the USA in the global financial sphere.
