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.
Benn Steil is an exceptional scholar hailing from the Council on Foreign Relations. I approached this book with high expectations and was not disappointed. If I had a buck for every blog, article, or interview referring to the Bretton Woods conference, dollar hegemony, the gold standard, and related monetary matters I could stop reading stuff like this because I would be rich. I surmise, however, that not one in 100 understand what really happened. I do not know if this is THE definitive work on the Bretton Woods conference but it certainly is a definitive treatise. Those who love quotes will burn through a few highlighters. (I did.) The intense discussions--snarky attacks and counterattacks by the combatants--are relayed in detail and in living color. Steil successfully takes you back to the events as though you were there. Minor warning: You do not need to be a wonk to love this book, but you must have some appreciation for wonky. It is not dumbed down to the lowest common denominator. Currency jocks will love the detailed descriptions of the battles over fixed exchange rates, adjustable exchange rates, free trade, dollar hegemony, and the role of gold in this new era.
Steil's discussion can be crudely described in three parts: (1) the decades leading up to the 1944 Bretton Woods conference; (2) the actual conference in which the next 50 years of currency exhanges and global trading rules would be mapped out; and (3) the consequences to the post-war world. The conference stemmed from a few astute players who realized that the world could fall into chaos if plans were not made in advance to establish a global currency regime and rules of global trade--a New World Order. This is that story and the subplots that bring life to the historically profound period.
At stake was a power struggle between the British and the US to establish post war dominance. My preconceived (and decidedly incorrect) notion of WWII was naively simple: the Brits got in a pan-European brawl; the isolationist-prone US sent massive military weaponry and aid via the Lend-Lease program to their strong ally; with Pearl Harbor as a proximate trigger, we entered the war. In reality, the Americans and the British were in a battle royale. The British were trying to establish an aid arrangement that would leave them strong enough to recover some of their imperial splendor after the war. The Americans placed extremely stringent demands on the so-called Lend-Lease program with the explicit intention of leaving the British economically prostrate to ensure American hegemony. There was nothing warm and fuzzy about the alliance. The Battle of Bretton Woods was indeed a battle spanning a number of years, and it got very ugly.
A large portion of the fight was by proxy through two critical figures. Economist John Maynard Keynes, one of the most prominent intellects of the 20th century (whether you like his economic theories or not, which I don't) squared off against Harry Dexter White, a determined yet highly enigmatic American. These two guys were attempting to determine the fate of the global economy through a war of wits and fierce negotions over three years preceeding the conference and at the conference with representatives from dozens of nations. At the conclusion of the conference, each was forced to turn their ample skill to beat back fierce resistance with their respective political elites back home to sell the agreements. It was arguably a fight to the death: both White and Keynes died of heart attacks soon thereafter. One could legitimately argue the Battle killed them.
My image of and respect for Keynes evolved enormously, not as an economist but rather as an unlikely diplomat. He was cantankerous to a fault, but he somehow found a way to compromise when necessary to optimize an otherwise very weak position for Britain and, most importantly, help seal an historically profound agreement. Harry Dexter White's character is confounding and enigmatic. He displayed an unorthodox desire for a strong post-war Russian-Soviet alliance. His pro-Soviet stance is a fascinating sub-plot that only begins to clarify in the post war (cold war) period.
The detailed analysis up to the mid 1950s gives way to a relatively brief synopsis in which Steil races us through the next half century briskly. This final portion, most of which is contained in the Epilogue, is filled with subject matter popular in the blogosphere that I had read many, many times. Steil takes us through deGaulle demanding gold, Nixon taking us off the last residue of the gold standard, the dollar's impact as the reserve currency, and central bankers aggressively fiddling with monetary policy. There was, however, a difference between this post-war synopsis and the reading the blogs: I understood it in a much deeper, contextually accurate way. I've finally got it; I understand our roots. Does it leave me more sanguine about current monetary policies and about the future? Not in the slightest.
Product Details :
Hardcover: 472 pages
Publisher: Princeton University Press (February 24, 2013)
Language: English
ISBN-10: 0691149097
ISBN-13: 978-0691149097
Product Dimensions: 9.3 x 6.2 x 1.6 inches
More Details about The Battle of Bretton Woods: John Maynard Keynes, Harry Dexter White, and the Making of a New World Order 1st Edition
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