Going Green for Life

DAVOS, Switzerland (Fortune) -- The Russians are upset that the
U.S. dollar is the world's principal reserve currency, and this week
in Davos they have been putting forward suggestions for how to fix the
issue. First came Prime Minister Vladimir Putin, who called in a
speech on Wednesday for efforts to "facilitate the emergence of
several reserve currencies."

On Thursday it was the turn of German Gref, a former Economics
Minister who is now CEO of Russia's largest bank, state-owned
Sberbank. His proposal during a panel discussion went even further
than Putin's: In the absence of any serious competitors to the dollar,
he advocated international control of U.S. monetary policy.

The biggest risk facing the world, he said, is that the U.S.
dollar plays a global role but is managed narrowly "in the vested
interests of only one country." In other words, he's pushing for the
U.S. Federal Reserve to be governed more like an international
institution than "merely" as the U.S. central bank.

Pressed by Fortune to explain what he means, Gref acknowledged
that he hasn't yet worked out the mechanisms for how Russia and other
countries would have a formal say in U.S. monetary policy.

But he insisted that the dollar's status as both the U.S. currency
and as a global one is "one of the three to four main reasons for this
crisis." Moreover, if the situation isn't changed, "we will stay in
the same international crisis."

I talked to several Russians and Russian watchers who are
attending the World Economic Forum, and they say that while the
Kremlin has long grumbled the dominance of the dollar, this is the
first time they've heard Russian officials putting forward specific
solutions - including having a say in U.S. monetary policy.

The Russians are chafing about the greenback because it has been
extremely volatile over the past few years - and because their oil and
gas is sold in dollars. And of course, the dollar is a potent
worldwide symbol of American economic and political power, which they
aren't all that crazy about either.

The Russian central bank has tried to mitigate the issue by
devaluing the ruble against a basket of currencies that comprises the
dollar and the euro, rather than just the dollar. When the financial
crisis exploded last fall, the ruble came under heavy selling pressure.

For several weeks, the central bank tried to prop it up, but after
blowing through about $150 billion to no avail, it has since allowed
the Russian currency to devalue gradually.