What's more: I suspect that a world that is already bound together with a common tech stack would have a much easier time coordinating resistance to dollar weaponization.
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Their paper represents a fusion of both of their approaches, and makes for fascinating reading. They start by characterizing the post-war global system as broadly "homeostatic," meaning that it can maintain stability in the face of shocks. Homeostasis requires a feedback mechanism so that it can constantly adjust itself - think of your home thermostat, which needs a thermometer so it can figure out when to run your furnace/air conditioner and when to stop.
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Political scientists have identified many of these feedback systems. For example, KN Waltz describes how, when one "great power" starts to dominate the world, the weaker states in its orbit will switch their alliances to rival powers, in order to "balance" power between the big beasts. Smaller, poorer, and/or weaker countries that have looked to the US for trade and military alliances might switch to China if it looks like the US is getting too powerful.
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Not necessarily because China offers a better deal than the US, but because a decisive global victory by the US would give it the power to squeeze these countries, because they'd have nowhere else to go.
Waltz's work is especially relevant this month, with Canada inking a Chinese trade deal and Canadian Prime Minister Mark Carney publicly declaring a "rupture" with the US-dominated order:
https://www.programmablemutter.com/p/davos-is-a-rational-ritual
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When great powers ignore the feedback of these systems, the result is a collapse in global homeostasis, and radical shifts in the global order. Farrell and Davies argue that this is what's happening with the weaponization of the dollar, which has prompted many countries to take action that should have caused the US to back off, but which the US has ignored as it doubled down on the weaponized dollar:
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Even when the US has a "rational" case for weaponizing the dollar - for example, by forcing the world into a global financial surveillance project aimed at stemming finance for terrorism - it runs the risk of making things worse. If the US's anti-terror financial demands are so onerous that they provoke other countries into setting up multiple, independent, fragmented global financial schemes, then terrorists and their backers will have their pick of ways to move money around.
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Even where the US has had limited success with financial sanctions (by isolating North Korea, or by targeting specific individuals rather than countries), it has undermined those successes by peddling and formalizing cryptocurrencies that evade those sanctions. With Trump's crypto project, America gets the worst of both worlds: ineffective financial sanctions that nevertheless weaken the dollar's centrality to the world, and the power that confers upon America.
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