The Telegraph nicely sums up the long-term implications of the fiscal impasse in Washington in a story that’s being passed around. A deal is close but it’s a limited can kicking exercise and with a Congress increasingly filled with zealots, it’s impossible to imagine the near-future with a properly functioning Congress. It’s also impossible to envision a future where the dollar is a more-dominant currency; instead it will gradually lose influence (and value).

Politics are grabbing the headlines but the bigger trend isn’t political. The dollar is the middle-man in many international financial because of historical lack of transparency elsewhere and high transaction costs. Foreign markets becoming more transparent, time is allowing them to build a track record and technology is driving down direct trading costs. More than politics, those will be the drivers of the decline of the dollar.