[StBernard] Bretton Woods II -- No Way

Westley Annis westley at da-parish.com
Fri Nov 14 20:27:27 EST 2008

Bretton Woods II -- No Way
by Patrick J. Buchanan (more by this author)
Posted 11/14/2008 ET

"Laissez-faire is finished, the all-powerful market that is always right,
that's finished," said Nicholas Sarkozy, speaking ex cathedra, last month.

As a result, said the diminutive French president, it is "necessary to
rebuild the entire global financial and monetary system from the bottom up,
the way it was done at Bretton Woods after World War II."

Sarky's history is a bit off. The Bretton Woods Agreements were actually
signed in July 1944, when German troops still occupied Paris, a month before
France was liberated by the Americans, who let Charles de Gaulle and the
Free French do the honors.

Our European friends seem positively giddy about this weekend's meeting in
Washington, where they hope to impose upon us a new world economic order
like the one we imposed in 1944.

We "must have a new Bretton Woods -- building a new financial architecture
for the years ahead," says Gordon Brown, who is surely aware the first
Bretton Woods was a British humiliation, with London yielding place and
submitting to Washington's dictation.

Brown and Sarky will be here for what is being bailed as a historic
gathering of the G-20, which consists of the G-7 -- the United States,
Canada, Britain, France, Germany, Italy and Japan -- plus the BRIC four, the
rising economic powers of Brazil, Russia, India and China, and other nine
economic powers, like Saudi Arabia, South Korea and Mexico.

Yet, to call this a second Bretton Woods is absurd. At that Mount Washington
Hotel gathering in New Hampshire, the United States, led by Treasury's Harry
Dexter White, who doubled as a Soviet spy, dictated the terms under which
the world economy was to operate.

The U.S. dollar, tied to gold, was to become the world's reserve currency.
The pound, the franc and other currencies were to be tied to the dollar at
fixed rates of exchange. An International Monetary Fund was established to
lend to nations with balance of payments problems. An International Bank for
Reconstruction and Development (World Bank) was created to provide loans for
rebuilding war-torn Europe.

America provided most of the financing for the new institutions and assumed
the lion's share of control. Though the most famous economist of the age,
J.M. Keynes, led the British delegation, his ideas -- for a new world
central bank and new world currency -- were brushed aside by Harry White and
the Americans.

The Bretton Woods system endured until Richard Nixon. With his country
hemorrhaging gold in 1971, Nixon slammed the gold window shut, cut the
dollar loose and let it float against other currencies. Nixon's was an act
of necessity. The Europeans, with more dollars than they needed or wanted,
were coming to cash them in and clean out Fort Knox.

To suggest that Europeans possess anything like the hegemonic power of
America in 1944 is delusion.

As Gideon Rachman writes in the Financial Times, Bretton Woods II holds
promise of being a flop. Even in America's financial crisis, no one can
dictate to the United States. Nor will rising nations like China, jealous of
their sovereignty, accept proctorship from an effete and aging Europe.

Brown wants the IMF to become the "global central bank," the Fed of the
world economy. No way, Brownie. Americans are not going to fund such a bank,
nor cede it authority, nor abide by its dictates. We are not yet a Third
World nation dependent on the IMF.

Globalists see in this worst of world financial crises since the 1930s what
New Dealers saw in the Depression: an opportunity to geometrically augment
government power and impose their visions upon mankind.

Barack Obama's chief of staff appears to entertain such thoughts. Said Rahm
Emanuel Sunday, "The crisis we have today is an opportunity to finally deal
with what Washington, for years, has kicked down the road.''

Brown and Sarkozy may believe a new era of multilateralism is upon us, in
which they will play great roles, as the bad old Bush era of American
unilateralism ends. But should Obama begin to cede U.S. sovereignty, he will
find himself in the same firestorm that engulfed George Bush and John McCain
when they sought amnesty for 12 million to 20 million illegal aliens.

The Europeans are dreaming. It is nationalism, not globalism or
multilateralism, that is resurgent worldwide. Recall: China, India and the
United States rejected the Kyoto Protocols on global warming. And even if
Obama agrees to global climate change demands, Beijing will not.

And while China, India and Brazil may make even more demands, the United
States is making no more concessions to conclude the Doha round of world
trade negotiations. Doha is dead. Big Labor, which backed Obama, wants no
more trade deals at the expense of U.S. workers.

Russia, too, is ready to use its veto in the Security Council to protect its
perceived great power interests.

American unipolarity, which all professed to abhor, is indeed at an end.

Let us see how the world likes the new multipolarity, with two, three, many
centers of power -- economic, political and military.

This looks less like 1944 than 1904, with the Brits in decline and half a
dozen other great powers rising.

Mr. Buchanan is a nationally syndicated columnist and author of Churchill,
Hitler, and "The Unnecessary War": How Britain Lost Its Empire and the West
Lost the World, "The Death of the West,", "The Great Betrayal," "A Republic,
Not an Empire" and "Where the Right Went Wrong."

More information about the StBernard mailing list