"Reckless U.S. fiscal policy is undermining the dollar's position even as the currency's role as a global money is expanding," he notes.

Steil imagines the ultimate solution is to privatize a global currency through a gold-based international monetary system.

"A new gold-based international monetary system surely sounds far-fetched," he concludes. "But so, in 1900 did a monetary system without gold. Modern technology makes a revival of gold money, through private gold banks, possible even without government support."