Despite a host of financial fears, the dollar is doing pretty well — relative to the rest of the global economy, at least.

That's no excuse, however, for policymakers to sit back and relax. We've got an opportunity to right the financial underpinnings of the economy before the dollar loses its precarious pride of place around the world. If we don't, we'll find ourselves in a world of hurt.

To be sure, it's a pleasant surprise that we're in as good shape as we are. Far in the rear-view mirror are last decade's worries that the euro would become the best currency around. Today, America's struggles pale in comparison with Europe's.

If our allies are hurting, our adversaries are on even less-advantageous financial ground. Russia's ruble has plunged so precipitously that comparisons are being drawn to its first post-communist financial meltdown, in 1998.

And China — although its economy is still running hot — has no basis from which to challenge American financial dominance.

There are two important reasons for that. First, China's massive holdings of U.S. Treasury bills require it to transition slowly away from the dollar-denominated financial system, if it is to do so at all. Switching to a different currency would require either the sudden dominance of a rival currency or the creation of a new one. And in almost all cases, whipping up a new currency isn't a slow-enough transition for China (or Russia, for that matter).

There's an exception, however. A new currency backed by a precious metal, such as gold, would introduce a radically different alternative to the dollar. The dollar drives the energy economy — in its role as the so-called “petrodollar.” A rival metal-backed currency, set up by China and Russia, would draw the great interest of Iran, Pakistan and others, beginning a domino effect in Asia, Africa and elsewhere.

But gold prices are currently in the tank. In part, that's because the big banks like it there. But in part, it's because the rest of the world's financial health is worse than America's. To keep it that way, we can't count on others' continued struggles. We have to clean up our own act — with real financial reform that deleverages the economy, disperses concentrated banking power and moves away from quantitative easing. Our golden opportunity to do so won't last forever.

— Orange County (Calif.) Register