The Deluge: The Great War, America and the Remaking of the Global Order, 1916-1931

by Adam Tooze

But once the decision to engage the US was adopted, once it was made into both a cornerstone of military strategy and of Entente propaganda, it created an immense dependence, and the Wilson administration both before and after American entry into the war was conscious of this. In the spring of 1917 Wilson’s Treasury Secretary (and son-in-law) William McAdoo made quite clear that he aimed to replace sterling with the dollar as the key reserve currency.35 As a first move, McAdoo proposed that no funds from congressionally approved Liberty Loans should be used to support either sterling or the franc. Nor should London be permitted to use such funds to repay overdrafts that it had contracted with J. P. Morgan during Wilson’s credit freeze over the winter of 1916–17.