Bretton Woods: birth of the free world's monetary system
BOSTON — FIFTY years ago, with Allied victory in World War II clearly if still distantly in sight, representatives of 44 ``united and associated'' nations met in the United States July 1, 1944, to design the postwar economic order. The hundreds of finance ministers, bankers, politicians, and monetary experts filled the grand old Mt. Washington Hotel, in Bretton Woods, N.H.
The primary purpose was to establish a fund to stabilize currency-exchange rates and facilitate international trade. Trade wars and currency devaluations in the 1930s had contributed to the Great Depression and the tensions that led to World War II.
The US delegation was headed by Treasury Secretary Henry Morgenthau Jr., who was named president of the conference. The principal economic strategists were Assistant Treasury Secretary Harry White and John Maynard Keynes, leader of the British delegation.
Although the delegates were working from blueprints drafted in Atlantic City, N.J., by 15 nations, over several weeks before the conference, this was a working meeting. Divided into committees, delegates and their technical advisers toiled day after day.
When the meeting adjourned July 23, the delegates had reached agreements establishing the International Monetary Fund and the Bank for Reconstruction and Development (World Bank). The agreements were then submitted to the parliaments of the participating nations for approval.