The Bretton Woods Agreements: Together with Scholarly Commentaries and Essential Historical Documents PDF
Preview The Bretton Woods Agreements: Together with Scholarly Commentaries and Essential Historical Documents
THE BRETTON WOODS AGREEMENTS Basic Documents in World Politics Basic Documents in World Politics reproduces foundational documents that have had a major impact on the character and course of world politics, together with interpretive essays by major scholars. The essays, all previously unpublished, range over the historical context within which the documents were written and their evolving influence in shaping the con temporary world. The goal is to make the documents and controversies they have spawned accessible to newcomers, while contributing to scholarly debates about their meaning and significance. Previous volumes in the series: Charter of the United Nations, edited by Ian Shapiro and Joseph Lampert (2014) Charter of the North Atlantic Treaty Organ ization, edited by Ian Shapiro and Adam Tooze (2018) THE BRETTON WOODS AGREEMENTS Together with Scholarly Commentaries and Essential Historical Documents Edited and with an Introduction by NAOMI LAMOREAUX AND IAN SHAPIRO Copyright © 2019 by Naomi Lamoreaux and Ian Shapiro. All rights reserved. This book may not be reproduced, in w hole or in part, including illustrations, in any form (beyond that copying permitted by Sections 107 and 108 of the U.S. Copyright Law and except by reviewers for the public press), without written permission from the publishers. Yale University Press books may be purchased in quantity for educational, business, or promotional use. For information, please e- mail sales . press@yale . edu (U.S. office) or sales@yaleup . co . uk (U.K. office). Designed by Mary Valencia. Set in Joanna and Eureka Sans type by Westchester Publishing Services. Printed in the United States of Amer i ca. Library of Congress Control Number: 2018962180 ISBN 978-0-300-23679-8 (paperback : alk. paper) A cata logue rec ord for this book is available from the British Library. This paper meets the requirements of ANSI/NISO Z39.48-1992 (Permanence of Paper). 10 9 8 7 6 5 4 3 2 1 Contents Introduction Naomi Lamoreaux and Ian Shapiro 1 Part I The Weight of the Past 1 The Po liti cal Economy of the Bretton Woods Agreements Jeffry Frieden 21 2 The Monetary Role of Gold as the Original Sin of Bretton Woods Barry Eichengreen 3 8 3 The Missing Bretton Woods Debate over Flexible Exchange Rates Douglas A. Irwin 56 Part II The Disappearing Order 4 The Universally Keynesian Vision of Bretton Woods James M. Boughton 77 5 Bretton Woods: The Parliamentary Debates in the United Kingdom Andrew Bailey, Gordon Bannerman, and Cheryl Schonhardt- Bailey 95 6 A “Barbarous Relic”: The French, Gold, and the Demise of Bretton Woods Michael J. Graetz and Olivia Briffault 121 Part III Paths Taken and Not Taken 7 Nutrition, Food, Agriculture, and the World Economy Martin Daunton 145 8 Australia’s Full- Employment Proposals at Bretton Woods: A Road Only Partly Taken Selwyn Cornish and Kurt Schuler 173 9 How the Bretton Woods Negotiations Helped to Pioneer International Development Eric Helleiner 195 vi CONTENTS Part IV Denouement and Legacy 10 The Operation and Demise of the Bretton Woods System, 1958–1971 Michael D. Bordo 2 17 11 Japan and the Collapse of Bretton Woods Frances McCall Rosenbluth and James Sund quist 236 12 The Multiple Contexts of Bretton Woods Harold James 254 Historical Documents Articles of Agreement Articles of Agreement of the International Monetary Fund, July 22, 1944 275 Articles of Agreement of the International Bank for Reconstruction and Development, July 22, 1944 311 The White Plan Preliminary Draft Outline of a Proposal for an International Stabilization Fund of the United and Associated Nations (Revised July 10, 1943) 342 The Keynes Plan Proposals for an International Clearing Union (April 1943) 363 The French Plan Suggestions Regarding International Monetary Relations (May 1943) 389 The Australian Employment Agreement The Employment Agreement 397 The Joint Statement Joint Statement by Experts on the Establishment of an International Monetary Fund (April 1944) 400 The Final Act Final Act (22 July 1944) 407 Speeches and Debates Speech by Lord Keynes on the International Monetary Fund Debate. House of Lords, May 23, 1944 429 Bretton Woods and International Cooperation, Henry Morgenthau, Jr. 439 Lord Keynes’s Speech at Inaugural Meeting of Governors of Fund and Bank, Savannah, 9 March 1946 452 CONTENTS vii Press Conference by Charles de Gaulle, Seeking the Abolition of the Gold Exchange Standard and a Return to the Gold Standard, February 4, 1965 454 Address to the Nation by Richard Nixon Outlining a New Economic Policy: “The Challenge of Peace.” August 15, 1971 458 Glossary 465 List of Contributors 473 Credits 475 Index 477 This page intentionally left blank 5/13/19 11:47 AM Introduction Naomi Lamoreaux and Ian Shapiro On July 1, 1944, less than a month a fter the D- Day landings in Normandy, delegates from forty- four nations gathered at a sprawling hotel near the base of Mount Washington in Bretton Woods, New Hampshire, to plan the postwar financial order. As the delegates debated the arcane details of a sys- tem of fixed but flexible exchange rates, Allied troops fought their way through France and battled island by island across the Pacific. US forces w ere sustaining heavy casualties on Guam when the conference ended three weeks later with agreement on two accords. One accord created the International Monetary Fund (IMF), and the other the International Bank for Reconstruc- tion and Development (IBRD), progenitor of the World Bank. The contrast between the life- and- death strug gles of the war and the eso- teric debates at the conference could not have been starker. At stake in both, however, was the kind of world that would take shape in the aftermath of the fighting. The battles determined which side would get the chance to re- make the world, and by July of 1944 it was clear that victory would go to the Allies. But what the postwar world would look like was yet to be determined. The Bretton Woods accords, reproduced at the end of this volume, were part of the answer. The essays we have collected h ere revisit the accords, dry and opaque as they might seem at first glance to be, with the aim of recapturing the fears and tensions that shaped their provisions. The essays also examine alternative proposals that the assembly might have adopted, ideas whose time had passed or were yet to come. Dominated by the United States, the conference left many prob lems unresolved, many countries’ needs unmet, and these omissions would lead to the eventual collapse of the system. The fate of the Bretton Woods accords, the essays show, was as much bound up with what was not accomplished as with what was. Dubbed the United Nations Monetary and Financial Conference, the gath- ering at Bretton Woods was the product of a series of planning conferences that began in Hot Springs, Virginia, in 1943 and culminated with a precon- ference meeting in Atlantic City, New Jersey, in June of 1944. Over the course 1
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