Bernanke and Paulson Threaten to Intervene to Protect Higher Paid Workers

That is in effect what Federal Reserve Board Chairman Ben Bernanke and Treasury Secretary Henry Paulson said when they announced they will intervene in currency markets to keep the dollar from falling further. When the dollar falls, it benefits workers who work in industries subject to international competition (e.g. manufacturing workers) at the expense of workers who are employed in largely protected sectors (e.g. doctors, lawyers, accountants, and economists). Since the workers in sectors subject to competition are disproportionately non-college educated, and the workers in the protected sectors are disproportionately workers with advanced degrees, the commitment to keep the dollar from falling can effectively be taken as a declaration of class war by the two highest ranking economic officials in the U.S. government. The distributional implications of this action have been completely absent from the media coverage of this move.

--Dean Baker