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eBook The Battle of Bretton Woods: John Maynard Keynes, Harry Dexter White, and the Making of a New World Order (Council on Foreign Relations Books (Princeton University Press)) ePub

eBook The Battle of Bretton Woods: John Maynard Keynes, Harry Dexter White, and the Making of a New World Order (Council on Foreign Relations Books (Princeton University Press)) ePub

by Benn Steil

  • ISBN: 0691149097
  • Category: Americas
  • Subcategory: History
  • Author: Benn Steil
  • Language: English
  • Publisher: Princeton University Press; Deckle edge edition (February 24, 2013)
  • Pages: 464
  • ePub book: 1140 kb
  • Fb2 book: 1885 kb
  • Other: rtf lrf lrf docx
  • Rating: 4.9
  • Votes: 630

Description

The book is full of lessons that are relevant today in a world that still resists international monetary reform . I was disappointed on that count

The book is full of lessons that are relevant today in a world that still resists international monetary reform. -Paul Volcker, former chairman of the Federal Reserve. Benn Steil has written a fascinating book with far-reaching consequences. In seeing the creation of the postwar economic system through the prism of the harsh interaction between Keynes and White, he makes complicated financial issues easy to fathom. I was disappointed on that count. The Battle of Bretton Woods doesn’t focus on the Bretton Woods conference per se. It is a work of intellectual history built around the two characters of John Maynard Keynes and Harry Dexter White.

John Maynard Keynes, Harry Dexter White, and the . Read an excerpt of The Battle of Bretton Woods.

Publisher – Princeton University Press. As World War II drew to a close, representatives from forty-four nations convened in the New Hampshire town of Bretton Woods to design a stable global monetary system. With calls for a new Bretton Woods following the financial crisis of 2008 and escalating currency wars, the book also offers valuable, practical lessons for policymakers today. More on: Financial Markets. A Council on Foreign Relations Book.

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Benn Steil calls his study The Battle of Bretton Woods but in reality the 1944 conference which created a new financial . Steil is a senior fellow at the American think-tank, the Council on Foreign Relations, and a well-known writer on financial topics.

Benn Steil calls his study The Battle of Bretton Woods but in reality the 1944 conference which created a new financial system after World War Two was more of a massacre of British interests by the . Treasury’s Harry Dexter White. He tells the story as personal, political and economic. John Maynard Keynes, the principal British negotiator, By Martin Hutchinson.

Upending the conventional wisdom that Bretton Woods was the product of an amiable Anglo-American collaboration, Steil shows that it was in reality part of a much more ambitious geopolitical agenda hatched within President Franklin D. Roosevelt's Treasury and aimed at eliminating Britain as an economic and political rival.

A Council on Foreign Relations Book. Includes bibliographical references and index

A Council on Foreign Relations Book. Includes bibliographical references and index.

Princeton University Press, Princeton, N. In conclusion, Steil’s book shows that it was not just Keynes who lost his battle, but also.

Princeton University Press, Princeton, NJ. 2013. Bretton Woods (the conference in 1944 being just the final stage of a process initiated years before). and of the unmaking of the system built on it, whose consequences have dragged along into very. His ‘Fighting for the US’ on the basis of making sure that the dollar would remain the.

Princeton University Press, Princeton, 2013. The book describes not only the central economic ideas, sources of contention, and personas of White and Keynes, but also offers important implications for the future of global financial stability today. ISBN: 978-0691149097. In Chapter 1, Steil explains his motivation.

This thought-provoking book is about much more than the 1944 conference that established the architecture of the postwar international monetary .

This thought-provoking book is about much more than the 1944 conference that established the architecture of the postwar international monetary system, leading to the establishment of the International Monetary Fund and the World Bank. Its title notwithstanding, this thought-provoking book is about much more than the 1944 conference that established the architecture of the postwar international monetary system, leading to the establishment of the International Monetary Fund and the World Bank.

When turmoil strikes world monetary and financial markets, leaders invariably call for 'a new Bretton Woods' to prevent catastrophic economic disorder and defuse political conflict. The name of the remote New Hampshire town where representatives of forty-four nations gathered in July 1944, in the midst of the century's second great war, has become shorthand for enlightened globalization. The actual story surrounding the historic Bretton Woods accords, however, is full of startling drama, intrigue, and rivalry, which are vividly brought to life in Benn Steil's epic account.

Upending the conventional wisdom that Bretton Woods was the product of an amiable Anglo-American collaboration, Steil shows that it was in reality part of a much more ambitious geopolitical agenda hatched within President Franklin D. Roosevelt's Treasury and aimed at eliminating Britain as an economic and political rival. At the heart of the drama were the antipodal characters of John Maynard Keynes, the renowned and revolutionary British economist, and Harry Dexter White, the dogged, self-made American technocrat. Bringing to bear new and striking archival evidence, Steil offers the most compelling portrait yet of the complex and controversial figure of White--the architect of the dollar's privileged place in the Bretton Woods monetary system, who also, very privately, admired Soviet economic planning and engaged in clandestine communications with Soviet intelligence officials and agents over many years.

A remarkably deft work of storytelling that reveals how the blueprint for the postwar economic order was actually drawn, The Battle of Bretton Woods is destined to become a classic of economic and political history.

Comments

NI_Rak NI_Rak
A solid historical background of the Bretton Woods agreement with colorful anecdotes describing the often acrimonious debate between the UK and US governments on the terms. In addition, Steil gives an inside look into the genius of Keynes and the political savvy of Harry White. The book is heavy on Macro-Econ principles which means you'll want at least a beginner's understanding of gold standards, currency manipulation, international trade strategies, and deficit spending.
Kaim Kaim
In 1944 delegates from 44 countries convened at the Mount Washington Hotel in Bretton Woods, New Hampshire. The topic of discussion was the post-World War II international financial system. In this book Benn Steil tells the story of what transpired at that meeting; he explains how the main characters interacted with each other, and how a rather obscure American civil servant was able to have his plan for the global financial architecture approved. This book masterfully tells the story of the “war of ideas” between Harry Dexter White and John Maynard Keynes, arguably the most famous economist of the 20th century. The style is lucid, the prose is elegant, and the attention to details is superb. This is economic history at its best.In 1944 delegates from 44 countries convened at the Mount Washington Hotel in Bretton Woods, New Hampshire. The topic of discussion was the post-World War II international financial system. In this book Benn Steil tells the story of what transpired at that meeting; he explains how the main characters interacted with each other, and how a rather obscure American civil servant was able to have his plan for the global financial architecture approved. This book masterfully tells the story of the “war of ideas” between Harry Dexter White and John Maynard Keynes, arguably the most famous economist of the 20th century. The style is lucid, the prose is elegant, and the attention to details is superb. This is economic history at its best.
Cordann Cordann
"The Battle of Bretton Woods" is a great read. I have a long standing interest in fiance and economics having studied the subject in college and graduate school. Steil's description of the disastrous financing of World War One and the following bitterness and mistrust created between the US and England by Europe's default on its loans (not to mention the fateful failure of the US to join the League of Nations) is told with clarity and great insight into the personalities who were called upon to finance the Second World War as well as rebuild the world following the war.

This is a great book. Easy to read and complex issues such as the Gold Standard are fully explained.
PC-rider PC-rider
The political battles of the WWII era is often overshadowed by the drama of those battles fought with real bullets. "The Battle of Bretton Woods" tells, in a quite readable way, the diplomatic battle between the US, who was looking to make permanent the economic supremacy they had achieved during the War and Britain, who was looking to salvage whatever economic leverage they might still have by the end of the War. The "Special Relationship" between the US and Britain that was established during WWII was in reality an uneasy alliance between two rivals that was never fully put aside for the duration of the War.

I liked this book. I gave it four stars (instead of five) as I think this book might be a bit of a slog for readers who don't have a familiarity with the various characters and events that populate this book. However, if you've got a familiarity with the subject, I think you'll enjoy this book.
Mavegar Mavegar
Bretton Woods was the most important international gathering since the Paris Peace Conference of 1919. I read this book looking for clues on how to host international conferences: how to accommodate delegates, maintain protocol, overcome obstacles, build consensus, and reach a satisfying outcome. I was disappointed on that count. The Battle of Bretton Woods doesn’t focus on the Bretton Woods conference per se. It is a work of intellectual history built around the two characters of John Maynard Keynes and Harry Dexter White. It describes the way these two Treasury officials negotiated the main financial issues facing the United States and the United Kingdom during World War II and immediately after: the Lend-Lease Act of 1941 granting the British access to war finance and equipment; the blueprints for a postwar monetary order that began circulating in 1942 and ultimately culminated in the adoption of the Articles of Agreement of the International Monetary Fund and the International Bank for Reconstruction and Development at Bretton Woods; the signing of the $4.4 billion Anglo-American Financial Agreement in December 1945; and the inaugural meeting of the IMF board of governors in Savannah, Georgia, on March 8, 1946. It mixes these elements of diplomatic history with personal aspects of the lives of the two main characters: Keynes’s inflated ego and lack of diplomatic acumen that resulted in missed opportunities for Great Britain; and White’s dual personality as the braintrust of the US Treasury and as a mole operating clandestinely for the Soviets.

To be sure, there are some useful indications on the Bretton Woods conference itself. It took place in the Mount Washington Hotel in New Hampshire, a luxury resort with striking views of the White Mountains. The organization itself was a mess: “everything is in a state of glorious confusion,” commented British economist Lionel Robbins, who added: “with all their virtues as technicians—and these are very great—the Americans are not good organizers of international conferences.” The conference took place in war time, and army bus and personnel brought the delegates in and out. Delegates were thrown out of the hotel on July 23 for fear they would reopen the discussion and have a closer look at the hastily agreed texts. The location itself owed a lot to domestic politics. US Treasury Secretary Henry Morgenthau wanted to court a local politician for future support of the agreement in the Senate, remembering the disastrous defeat of Wilson’s League of Nations in Congress after World War I. The press was also in attendance, and Bretton Woods became one of the first international conferences to be covered live by the media. Most of the delegates came from Ministries of Finance or central banks, and true diplomats—the ones hailing from Ministries of Foreign Affairs—were a rare occurrence. The US Treasury Department had willingly kept the State Department out of the loop, and considered the only senior diplomat present, Undersecretary of State Dean Acheson, as “one of them”.

The conference was only the tip of the iceberg: everything was set in advance, during the two years when plans were circulated and drafts were discussed. The invitations were sent to forty-four nations, but the United States ran the show from start to finish, and even British delegates were relegated to a secondary role. Keynes, who had termed the Reconstruction Bank scheme imagined by White “the work of a lunatic,…some sort of bad joke,” was named chairman of the commission that drafted the Bank’s Articles of Agreement, while White himself dealt with the much more significant IMF. As for other nations, their input was limited to discussing the national quotas that would measure their relative power and influence at the boards of the two institutions or, in the case of the Cubans, to “providing the cigars”. White’s goal was to “channel the energy, aims, ambitions, and vanities of the mass of delegates into meaningless debate.” As an American organizer wily remarked, “there should be just one general rule: that anybody can talk as long as he pleases, provided he doesn’t say anything.” To make things even safer, the session secretaries were all Americans, appointed by White, and it was they who wrote the official minutes of the committees. Some important remarks made during sessions disappeared from the draft minutes, while crucial provisions were introduced surreptitiously in the final text versions. As an example, White’s technicians strategically replaced “gold” with “gold and dollars” in the paper describing the foundations of the postwar monetary order, a crucial modification that Keynes discovered only after his departure from Bretton Woods.

The result was, in Keynes’s words, “the most monstrous monkey-house assembled for years.” The distinguished Cambridge don liked that expression, and indeed often referred to non-Anglo-saxons as monkeys, with a special mention to the French which he utterly despised. But the monkey-king in this diplomatic jungle was certainly Keynes himself. Long before Paul Krugman and Thomas Piketty, Keynes was the first-ever international celebrity economist. He was surrounded by an aura of awe and admiration, and the printed media craved for his every declarations. In Benn Steil’s rendering, he had “an effortless facility with words that might have made him a master diplomat, had he actually been more concerned with convincing opponents than with cornering them logically and humiliating them.” “The man is a menace for international relations,” remarked fellow British economist James Meade, who nonetheless revered him. He would make aggressive jokes on lawyers in front of American lawyers, show his contempt for other delegates by displaying his immense intellectual superiority, and try to steal the show by pretending the outcomes of negotiations were all due to his influence while in fact they ran counter to his prescriptions. His last speech in Savannah, where he metaphorically summoned spirits and fairies to bestow the newborn institutions with their gifts, was taken as a personal attack by the American delegate: “I do mind being called a fairy,” he muttered to his aide.

If a statesman is to be judged by his capacity to serve the national interest, Keynes failed miserably in his attempt at statesmanship. This is not to say that he didn’t have Britain’s interest in mind. His visionary monetary schemes notwithstanding, he had ultimately come to the United States with the mission of conserving what he could of bankrupt Britain’s historic imperial prerogatives. As Schumpeter wrote, “Keynes’s advice was in the first instance always English advice, born of English problems.” Keynes was thoroughly British, and it was the British problems of his day that drove his theorizing: problems of deflation and depression, paying for war and surviving the perilous transition to peace. He had spent his career thinking about monetary issues as a way to preserve his country’s clout in the world. In particular, the shift of financial power from London to New York was a matter of constant concern for him. But he lacked the basic insight that the Americans did not share British national interests, and that they could even be rival powers on the international scene. Throughout the war, Keynes continuously overestimated American sympathies with Britain and underestimated the importance of public and congressional resistance to US aid or involvement. He thought of Bretton Woods as a battle of ideas, counting on his immense intellectual superiority to carry the day, whereas it was first and foremost a battle of power and influence, with the United States as the clear winner.

Indeed, British and American interests were not identical, however much both peoples were dedicated to destroying Nazism. Henry White had a clear goal in Bretton Woods: to entrench the dollar as the world’s currency, and to make it “as good as gold”. He used the leverage provided by the Lend-Lease agreement and Britain’s quasi-bankrupt situation in order to put a permanent end to the pound sterling’s international role. This required dismantling the structural supports of the British empire. In particular, Americans sought to put an end to “imperial preference”, by which Britain secured privileged trade access to the markets of its colonies and dominions. There was no room in the new order for the remnants of British imperial glory: the postwar world needed to be grounded in nondiscriminatory multilateral trade and full monetary convertibility. The Americans never deviated from their hard-line geopolitical terms. Many held no particular sympathy for the British, who had “shamefully walked away from their Great War debt obligations,” and who were trying to extend their Empire’s lease of life by credit. At Bretton Woods, we see American power in full swing, and in particular the role of the US Treasury as the economic arm of American foreign policy.

Contrary to the myth, Bretton Woods did not provide the economic foundation for postwar prosperity and monetary stability. And it was not the cooperative, disinterested, forward-looking endeavor that people often have in mind when they stress the need for a new Bretton Woods. The Bretton Woods system didn’t work the way it was supposed to. It was effective for only a brief period, and then not for the reason its authors had envisaged. It was not until 1961, fifteen years after the IMF was inaugurated, that the first nine European countries formally adopted the required provisions that their currencies be convertible into dollars. Even then, Bretton Woods was an ineffective and crisis-prone monetary system. It began experiencing potentially fatal difficulties as early as the late 1950s, and was only kept alive by a series of political fixes that made little long-term, macroeconomic sense. It could never have survived the globalization of finance and the removal of capital controls that began to take place in the 1970s. Indeed, it can be argued that the system was doomed the moment that it came into existence, and that the Bretton Woods agreements contained fatal flaws that could only lead to the abandon of gold convertibility.

Not only was Bretton Woods a crisis-prone, unstable system: it was also a bad deal for Great Britain and, one could argue, for the United States and for the world as well. What Britain actually needed in 1944-45 was short-term financing at reasonable cost with few geopolitical strings attached, and possibly a lower exchange rate. There was evident hubris in the attempt to design a global monetary system, to be managed by an international body, at a time when the outcome of the war was not yet clear. Keynes and White’s ambition was to create “a New Deal for a new world,” but they lacked the political legitimacy and also the effective means to achieve such a grand plan. Another course of action was possible for the United Kingdom, one suggested by a British Treasury official after the facts: postpone the “Grand Design” negotiations, avoid irreversible decisions, try to buy time until you see how the new postwar world develops, and borrow your way out of the crisis by getting a commercial loan from Wall Street. Who at Bretton Woods would have thought that the British empire would unravel, the United States and the Soviet Union turn into arch-enemies, and the world divide into hostile camps just two years after the conference? There was no necessity to conclude Bretton Woods in a haste. Waiting for the San Francisco conference to address the issue of money and finance jointly with the creation of the United Nations would have made the postwar institutional framework more coherent. The world would have avoided the dichotomy between the Bretton Woods institutions in Washington and the United Nations in New York, in which both seem to live on completely different planes.

So are there practical lessons from Bretton Woods for statesmen and diplomats hosting international meetings, such as the Paris Conference on Climate Change that will take place in end-November and December 2015? First, as the previous attempt to tackle climate change at Copenhagen taught us, the summit itself is not the place where comprehensive negotiations should take place. Most items on the agenda should be solved beforehand, in preparatory meetings among experts or in a pre-summit rehearsal such as the UN General Assembly in New York. Second, organizers should make sure they keep a bone for the leaders and national delegates to chew, one that is easy enough to grasp and with a clear payoff in terms of national interest, such as the quota issue at Bretton Woods. Managing expectations and egos will always be a tricky issue, but one that diplomats are best equipped to handle. How to deal with the media is also a key issue, particularly in our age of instant communication and world broadcasting. Lastly, a modicum of modesty should be in order: the world is not going to be saved by international conferences, however successful they turn out to be. For Britain in 1944 and for the planet as a whole in 2015, buying time is always a sensible option.
Marirne Marirne
Very well written and researched review of the economic and political issues, along with the principal personalities particularly J.M. Keynes and Harry White, involved in the negotiations of international exchange rates.