The benefit for American people to have the US dollar as the dominant reserve currency, and the risk of losing it.

The US government's ability to print money at will provides tremendous benefit to American people. How great is this benefit? Maybe the best way to answer this question is imagining what would happen if the US dollar lost its reserve currency status.  The article "What If The U.S. Dollar Loses Reserve Currency Status?" by Thomas Herold is highly recommended. In summary, we could see triple digit inflation and astronomical interest rates. If this happened overnight, depression would be certain.

Reserve currencies come and go. The US dollar's reserve currency status will at least be lowered significantly.  It is just a question of time. Many other countries have been talking about other choices for reserve currency. United Nations Conference on Trade and Development (UNCTD) issued a report in 2009 calling for a new reserve currency based on the Special Drawing Rights (SDR) that is calculated daily from a basket of U.S. dollar, euro, Japanese yen and British pound.

The portion of the US dollar in official foreign exchange reserves has decreased from 71% in 2001 to 61% in 2011.  This trend will continue as more and more countries are concerned about American debt.  The euro has already accounted for about 27%.  The EU is still a young union.  Once it gets over its current financial mess, and continues its maturation, the euro's reserve currency status will continue to rise.

The Chinese RMB cannot be a reserve currency because of the control and manipulation of the government.  More importantly, China is currently an inherently unstable country under a totalitarian regime.  It is like a volcano that may erupt at any moment.  If China starts to transition to democracy peacefully , and the RMB is valued by the market, not by the government, the RMB can become a major reserve currency. The Chinese currency Tael was an international currency  once upon a time.

Though the US dollar will likely be the dominant reserve currency for the foreseeable future, it would be beneficial to prepare for the end of its dominance by reducing American debt eventually while taking advantage of such status currently to boost its wounded economy.