Abstract
3 min readThe Bretton Woods negotiations are typically described as an intellectual contest between Harry Dexter White and John Maynard Keynes and their rival plans for postwar monetary order. This framing directs attention to the national priorities that the two statesmen sought to advance—an open trading system based on pegged exchange rates and free capital markets in the case of the United States and a full-employment-friendly international system of adjustable exchange rates and inconvertible currencies in the case of Great Britain. The story reaches a climax with the compromise of pegged but adjustable exchange rates and currencies convertible on current but not capital account. Richard Gardner’s Sterling-Dollar Diplomacy in Current Perspective: The Origins and Prospects of Our International Economic Order (New York, 1956) is an influential case in point; Benn Steil’s Battle of Bretton Woods: John Maynard Keynes, Harry Dexter White and the Making of a New World Order (Princeton, 2013) is another.While acknowledging that thirty-two of the forty-four delegations at Bretton Woods were from what we would now call emerging markets, this narrative dismisses their participation as marginal. As a result, their agenda of finance for development was diminished. The International Monetary Fund, not the World Bank, became the dominant Bretton Woods institution, and the Fund focused on the advanced countries.Drawing on the ample secondary literature but also on such primary sources as the recently rediscovered transcripts of the Bretton Woods conference, Helleiner challenges this conventional view. Developing countries, far from passive, actively sought to advance their interests. The United States and the United Kingdom embraced their arguments for state-led development and official finance. The New Deal rendered American officials sympathetic to arguments in favor of an expanded role for the state. Already, in the second half of the 1930s, these officials had sought a financial partnership with Latin America under the umbrella of President Franklin D. Roosevelt’s Good Neighbor policy. U.S. “money doctors” like White, as well as Robert Triffin of the Federal Reserve Board, had headed technical-assistance missions with a strong developmental component to Cuba and Paraguay. Helleiner rejects Gardner’s argument that the developmental agenda, as symbolized by the Point Four Program of technical assistance announced by PresidentTruman in his 1949 inaugural address, if not also the very concept of international development, were products of the Cold War.Helleiner makes a compelling case, although he exaggerates the influence of developing countries at Bretton Woods. They attended, to be sure. They offered ideas. But their mere presence does not mean that they significantly influenced the negotiations or the outcome. There was an asymmetry of power, since the United States held the purse strings. Moreover, as Helleiner recounts, disagreements prevented the developing-country delegations from forming a united front.Nonetheless, development was undoubtedly an important issue at Bretton Woods, and the experience of the preceding decade created fertile soil in which to plant the concept. But this situation raises the question of why earlier historians drew the wrong conclusions. The Cold War, Helleiner suggests, redirected the attention of the United States—and its chroniclers—away from Latin America and toward monetary and economic stability in Europe (he might also have pointed to the Communist takeover of China as further diminishing the salience of the Bretton Woods developmental agenda). Financial interests hostile to the World Bank received a warmer reception from the new Truman administration. Accusations that White was a Soviet fellow traveler diminished the stature of the institutions of which he was an architect. These are intriguing arguments, although at some level they are not entirely satisfactory resolutions of the paradox.Forgotten Foundations is classic interdisciplinary history, drawing on literatures from political science and economics as well as primary sources. Even if he overstates his case, Helleiner has made an important contribution that will permanently re-frame how scholars conceptualize Bretton Woods.
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