>And since military relies on the USD for funding, you could probably assume that the USD is going nowhere as long the US military is powerful (with some hand waving), which looks like a good bet.

But that is not income and would only put the US in debt, devaluing the USD.

I think the point he was alluding to is that countries hold a significant chunk of their foreign reserves in USD, which keeps demand for USD high. Other than the obvious trade aspect, one of the major reasons countries do so is because they purchase goods and services from the US military. (e.g. Japan, South Korea).