Tuesday, November 6, 2007
The post-WWII Bretton Woods System of Economic Order
Are the various financial institutions that were created after the end of WWII (such as the World Bank, the IMF, the GATT and subsequently the WTO) a manifestation of American hegemony and economic colonialism? What are the benefits of such institutions? Do those benefits outweigh the idea that international financial institutions are nothing but mere tools in the hands of Great Powers to dominate the less-priviliged ones? Discuss.
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The World Bank, created in 1945, was originally intended to loan money to countries in need of: post-war reconstruction, repair from natural disasters, humanitarian emergencies, etc. In essence - this concept is great, the larger countries attempting to help smaller or less powerful countries succeed. However, a critical approach to the World Bank asserts that the World Bank is a mere American tool (the President is either an American of nominated by an American) to gain larger control over world politics.
The IMF, also created in December of 1945, is designed to foster global monetary cooperation and financial stability. However, critics have found that actual recordable success is limited.
The GATT, an organization which intended to lower trade barriers and was eventually replaced with the WTO in the early nineties, seems to me, the most successful and least criticized of all the aforementioned. Perhaps this is because it was an organization and not an instituition? In class, someone asked how the "rules" were enforced, and I see them as being generally followed by an honor system, or the golden rule, "Do onto others as other would do onto you."
Together, all three orginal financial institutions were originally designed to help the global economy and foster cooperation between privelged countries and those dependent on priveleged countries. The benefits of which are questionable and limited to personal interests. The GATT appears to be the most successful of the organizations/institutions because it seemed to focus on the good of ALL TRADE and ALL countries/states, not just what one rich country can make a poorer country succumb to. In reality, I do see the World Bank and the IMF as forces to help manifest American hegemony, with such a powerful hold on the dependent countries/nations, how could it not be? The US has a large hand in each of the institutions and often makes/controls many of the key decisions. This influence is an indictor of hegemony.
To sum that all up, while there are benefits to having such institutions as the World Bank and the IMF, they are in reality American tools used to maintain a strong control on world politics.
- Megan Pettingill
The established purposes of financial institutions created after WWII prove that they were not created with the intention of American hegemony. The World Bank was created to give loans to and assist third world countries in financial disarray. While many argue that the World Bank was created to aid in US business ventures, it is very active in many aspects of assisting countries in financial disrepair. The IMF was also created to assist financially hurting nations in their quest to build up their economies by monitoring balances of payments and exchange rates to ensure that those nations are not being cheated. The GATT was created to foster international trade between all nations. Though many of these organizations are disputed and are accused of favoring more powerful nations, such as the United States, the initial intention of creating these organizations was for the betterment of international society as a whole.
There are many benefits to these organizations, both for powerful countries, such as the US, and the counties receiving aid from these organizations. The financially disabled countries benefit by getting loans and monetary assistance from these organizations. They are able to fix current problems and situations in their respective countries in order to ensure the survival of the country and its people. More powerful countries are benefitted later on, when they are repaid and receive interest. These benefits certainly outweigh the negatives. Without such organizations, financially crippled states would not be able to fix their problems. Without the ability to fix current situations, they do not have a foreseeable future upon which their countries can grow and flourish. The assistance they receive from these organizations is set to put them back on their feet. Once the countries are financially secure, they repay their loans with an interest rate. While the interest may cause some financial disarray, this financial duress is not as bad as the problems before they received the loans. The country is far better off than it was before it was given assistance. If it is not better off, then atleast it has lived to see another day. Even the GATT, which was not a loan-giving organization was helpful to such countries because its objective was to establish fair trade among nations and look out for the interests and needs of smaller countries to ensure that everything ran smoothly.
It is clear that though these financial organizations greatly benefit and aid American power, they also genuinely assist countries in need and the benefits of such institutions far outweigh their negatives.
--Jessica Jackman
Now let's look at this for what it really is, an American institution, that is being implemented and pushed by and for America. These global institutions push American free trade values on all countries in the world. Looking at this in any way other than something that America is pushing to further it's own needs is flawed. Therefore whether or not these systems are good depends on what side of the fence you are on. If your for American ideals and values, then yes the Breton Woods system is great. It furthers American ideals and makes America more powerful in the world stage as long as it is accepted on the world stage. Now on the other side of the fence if your against America and for other economic systems this is horrible. Not only does this system make America more powerful (and therefore whatever views it pushes,) it slowly makes your economic system more obsolete. Not to say it directly affects a different economic system, rather it makes free market societies better in the global economy. Making other options less favorable. Thus if you are for American free market society, you are for the Breton Woods system, if you are against America, you are against the Breton Woods system.
-Christopher Fromme
i believe the benefits of these institutions would be first off Bretton woods-regulated monetary relations among independent states...and its good because it overlooks all the financial systems of the world you need to have something keep everything in check.. also a benefit of bretton woods was that is helped places when they were in financial crisis. i feel that the benefits dont out weigh the idea that international financial institutions are nothing but tools to have power over less dominate places because no matter what there will always be a place dominant over another and that is just human nature not necessarily fair but life is not fair.There needs to be a leader, someone with power, someone keeping things in check that is the way the world has always worked.
Kristin Iorii
I agree with Jessica, the purpose of these financial institutions was not to further American hegemony. These organizations aid financially crippled states that would not be able to fix their problems otherwise. They would not have any real future as a country if they could not can grow and flourish. Institutions like the World Bank were created to assist third world countries by giving them loans. The World Bank enabled larger countries to aid developing countries and benefit later on when they receive interest on the loans they gave out. The IMF was also created to assist developing nations financially. The IMF wants to build up their economies by monitoring balances of payments and exchange rates. The IMF ensures that these nations are not being cheated.
Kaitlin Keelan
The debate over whether or not American economic systems are beneficial for third world countries is in a sense comical. I say this because when you look at the poorest regions of the world at any time period, you really have to ask yourself if life for those people can be any worse than it already is? The truth is that despite the obvious problems with these such as child labor, these policies are in the interest of the poorest nations. As a note- I did a report about child labor in India- there 100million child laborers in India alone.
If you are skeptical about globalization you ought to put yourself in this particular scenario. Imagine that you are a 12 year old girl in China who is workign 60 hours a week in a shoe factory so that your family can eat. (You get paid terribly because your productivity is very low) Suddenly, America comes along and decides that they need to legislate new child labor laws that ban those under 15 from working in factories. Well, now you're unemployed but your family is still dirt poor and needs food. To put it another way, the only way your family can get food is if you continue to work. Now that you cannot work in the formal market you are left with the informal market. In the case of the twelve year old girl- that likely means prostitution.
Instead of getting work experience and the increased salary over time that will rseult from it, the girl will not learn a skill. Moreover, her "work" will be infinitely more miserable than factory life and she will be in a generally unsafe "working" environment.
-Dan Greenbaum
What I am suggesting is that you are essentially given two options as the consumer and are forced to choose the lesser of two evils. Also, we need to recognize that America, Japan, and Britains industrial age was unbelievably destructive in terms of human suffering and Russia was on its own level of horror. We know how to get to the modern age, but only seem to have one morally repugnant way of getting there.
-Dan Greenbaum
It is a known fact that the U.S. has a big part and control in world politics. This has been possible due to such institutions as the International Monetary Fund (IMF), the WTO, and the GATT. In a world that if one country’s economy collapses, others are seriously affected due to globalization. These institutions were supposed to help post war reconstruction and slowly deteriorating economies before they collapsed and help get them back on their feet. They were also supposed to help prevent trade discrimination that led to previous wars. Although the IMF really did not help much because Argentina’s economy collapsed after listening to everything the IMF said. I do believe that the Bretton Woods system of international monetary policy was intended to mainly function as a way to ensure economic security and to govern monetary relations among independent states. I feel that it wasn’t intentionally sought out to just to help a Hegemony grow more powerful. It did in fact help the U.S. grow bigger as a world power and help us stay on top as a dominant force post world war II. It allowed the United States to be able to have a hold on smaller more dependant countries and also allow our currency to be basically based on gold.
-James Squillante
The post-WWII financial institutions were not meant to be manifestations of American hegemony, but they ended up that way because of how the global sytem was structured. Originally, organizations were established to create a democratic way to regulate monetary relations between countries, and to deal with problems like the Great Depression or wartime devastation of some countries. But because of America's power, it became the leading force. Other currencies were fixed to the dollar's value, and the U.S. had no other government interfering with its economy, so by default it was the strongest.
Most of the benefits that came from these organizations had to do with third-world countries getting loans or the democratic processes (such as negotiation or "most favored nation" policies) used to run them. But overall, I don't think these benefits make up for the fact that the Great Powers have so much authority over smaller countries. The dominant countries can make life worse for the smaller ones by forcing their corporate institutions on the poorer economies or even refusing loans. So even though the post-war system was well-intentioned at its establishment, the fact that U.S. and other Great Powers have such a strong hold on the other countries has made it overall less effective as a fair and just system of international financial affairs.
--Katie Head
Like a presnet day robin hood these international institutions aimed to take from the rich and give to the poor, the only catch the money taken from the rich had to be returned with intrest. This is why while at thier core organizations such as these may seem to be fair to all, but I feel that they truly function as tools for larger wealthier states to exploit weaker nations and keep them repressed.
At the Bretton Woods conference Henry Morgenthau, then US Treasury Secretary and president of the conference said the purpose was, "the creation of a dynamic world economy," to sustain the domestic American economy's continuous expansion by ensuring it sufficient access to foreign markets and raw materials.
Leaders of the organizations currently shift this when questioned curretnly. They maintain that their goal is to alleviate poverty. If this is the case they certainly are not succeding.World poverty is at an alltime high. One fifth of the worlds population lives on less than one dollar a day. It is not fair that millions suffer while few wealthy countries benifit.
The problem however is while these organizations may be currupt and only out for the intrest of a select few the services they provide are very nessecary.I belive in promoting free trade all over the world. I also think their has to be an organization that can provide aid to countries in need either during a period of expanision or during recovery from some sort of disaster. that is the real problem. How to establish the positive qualties of these organizations without the curruption? The only way I can think to is to make it more democatic. Get more countries involved to check one another and not let any few gain to much power.
-Dan Shainker
I believe institutions such as the world bank are a manifestation of economic colonialism. These institutions were created directly following WWII which directly reflects the countries that they benefit. Of course the World Bank benefits the United States, why wouldn't it? After the war the U.S. was in a position of great power with the ability to shape the world into what it wanted most. The world bank gives the U.S. indirect control of many countries because the money borrowed will shape their politics and economies. In terms realism the world bank is a very sucessful tool to be used by the U.S. As a state the U.S. needs to do what is necessary to keep us in control and power amung all the states of the world.
Tommy Luginbill
Here's a question that has been on my mind for a considerable length of time, regarding economic development in the Third World:
There are a fixed number of resources in the world. Renewable, non-renewable, regardless; there is only so much material in the world. I would think that there is only a limited amount of capital that could be maintained under these circumstances as well. My question is, if the Third World does develop to a level at par with the First World, will it be our expense? It's nice to imagine that everyone could have the standards of living and the economic prosperity as the US has, but I can't help but wonder about this.
- Luke Kaczmarek
At the end of WWII, the world economy was in bad shape. Financial institutions such as the World Bank, the IMF, the GATT and subsequently the WTO were formed in order to allow economic recovery. The benefits of these organizations were that it provided a system of rules, institutions, and procedures to regulate the international monetary system after World War II.
For example, the World Bank makes loans to developing countries for programs with the goal of reducing poverty. Essentially, the World Bank tries to help nations that are struggling. Additionally, the Bretton Wood System was the 1st example of a fully negotiated monetary order intended to govern the monetary relations among independent states. The Bretton Wood System directly led to the establishment of the International monetary Fund, the international bank for reconstruction, and development and the General Agreement of Tariffs and Trade (GATT). The GATT's main objective was to reduce barriers of international trade.
Another benefit was that these institutions finally stopped convertibility from money to gold. They are essentially good institutions to be emplaced because they will try and prevent any depressions in the future. For these reasons, I do believe that these institutions and their ideals outweigh the idea that international financial institutions are nothing but mere tools in the hands of Great Powers to dominate the less-privileged ones. I believe that these institutions were put into place to benefit international society. These institutions clearly benefit the United States but they do benefit other countries including third world countries as well. Thus, there are deffinately positive benefits which come from these financial institutions.
-Erin Donahue
Wasn't it discussed in class that the World Bank was somewhat criticized after a while because people accused the US for being a Janus-like player in post war Europe? What i mean by that is that didn't people accuse the Us for making it look like they were trying to be benevolent, (which they were) but the World Bank was also a way for the US to kind of set up, or assert there power internationally? That they set it up to look like help, but really the main reason they were setting up the bank was for personal gain? Which organization was set up to where your power depends solely on how much you invest into the organization? Anyways, i feel the intentions were good on behalf of the US, but the set up and planning could have been thought out a little better. We know that the US loaned out lots of money that nations were too poor to pay back correct? and that the US will never see some of that money again right? well, there should have been some clauses that protected them from that. Also, im curious...how much did our allies contribute into this idea? Why is it always us that is involved in Fricken EVERYTHING with nations that have either never done anything for us ever, or for a nation that we should sometimes say "screw it, let them work this out on their own." I am irritated that the US thinks that its their responsibility to Police the world. Think of how much money we would save if all our armed forces just chilled and were in a defensive mode that required no expenses for operation or mobility. I'm not sure if anything i have just said made any sense, but whatever, that's what i have to say.
Ryan Harrison
I am also interested in the idea of third world nations growing economically to equal the power and wealth of the much more superior nations like that of the US. It seems that this is totally impossible considering the lack of any sort of endless resources. However, i do not believe that more powerful countries such as the US would allow these countries to increase to this standard regardless of their supposed desire to help them. The fact of the matter is that these countries have too many problems aside from military and economics such as disease, health care, and education to be able to make any sort of substantial leap into the economic hierarchy.
Ryan Adam
The world bank is severly unbalanced. Throughout its existence it has always had an American president and the U.S. controls a seven percent vote even though it is only one member state. The voting system is based on GDP, so the rich states always get the say in where loans go and what strings are attached. This leads to poor countries being pressured to adhere to requirements which likely include things such as maintaining a more democratic state. Because the U.S. has such control over the World Bank, states that request loans are influenced by American interests.
John Dalo
In many international organizations, like these financial institutions, rely heavily on US support and aid. It’s very unlikely that a motion will be passed if it is not supported by the US. Specifically in the IMF the US has the most votes, therefore the most power and influence. The benefits of the IMF are that the group helps countries stay monetarily sound and stable and promotes global growth. Honestly, I think these benefits of the IMF are worth it even if the super powers essentially have the upper hand. In the long run, these super powers are going to help the less-developed countries who are receiving the money. I don’t see anything wrong with admitting you need help/money if it’s for the country’s citizens and will help the country as a whole. Also it is an obvious interest to US to create more free trade markets and as we are reading in the Friedman book, that seems to be the only way for a country to succeed. Other countries, however, might have trouble believing this.
-Katie Dunn
I think that the creation of the International Monetary Fund(IMF), the General Agreement on Tariffs and Trade (GATT), and later the WTO after World War II was a good idea and it definitely helped the international banking and monetary management after the war. I think that it was a good idea because it helped many nations to recooperate on what money was lost during the war with casualties and other things. I also believe that even though these were made to mostly only benefit the Great Powers that the benefits definitely outweighed the weaknesses of these systems. This is because the Great Powers were basically the only states that needed money and needed to manage themselves economically after the war because they were basically the only ones involved in the World War to begin with.
Overall, I think that the Bretton Woods System of International Monetary management was a good thing.
-Robert O'Reilly
The Bretton Woods system in the era of the post-WWII era was not created as a way to add to American Hegemony. I believe that it was honest in its humanitartian effort to bring back balance to the war torn European countries. Even the US as a power after WWII needed its allies to be strong so that the US could have trade partners. The concept of free trade stopping war is a solid concept and was one that many nations would indeed support. Even the US who entered late into the war would take actoins in the future to avoid a global war like the two fought in the first half of the 20th century.
However after the respective countries of Europe began to strengthen their own economies the orginizations under the Breton Woods system should have become more global within themselves. These verious orginizations did create windows for US companies to enter foreign poorer countries and access to their cheaper wage labor. This idea though creates a difficult and touchy subject. The concept of foriegn companies taking advantage of child labor is a terrible to a wealthy nation such as the US. However to some poor countries these wages are a G*d send. So while these companies do create some evils they do provide some benefits. They do spread American influence but as to the manifestation of an American hegemony I am unsure. More so the spread of Capitalism.
~Kevin Wright
I believe that all these institutions COULD be extremely beneficial to the world and help everyone prosper. However, I believe that they have ultimately become an American tool to preserve hegemony. When superpowers are able to use the leverage of loans to meddle in the affairs of less fortunate nations this is a violation of sovereignty, and essentially blackmail. It is on the US and other world powers to see that this institutions are not abused but rather used to mutually benefit everyone like they were intended.
Brian Del Guercio
I do believe that these financial institutions are not made purposely to further American hegemony because these distinct financial insitutions were organized to aid other countries in desperate need of surviving the setbacks they have endured in their economy and culture.There are benefits to having these financial institutions in the U.S because it represents our quality of wanting a better life not just for our people but for the other parts of the world as well. I do also believe that they are mere tools for a Greater Power to control a smaller power because as it works there are always higher, stronger powers that are able to outdue the other components whether is be financially like the IMF does or aiding countries who are not able to do this themselves as the World Bank does. With the fact that these institutions were created after WWII demonstrates another reason as to why these are definitely not manifestations of American hegemony because it took America to recognize the problems that occured after the world war to consider, fund, and construct these useful institutions.
-Kelley Thompson
At the end of World War two the world was in shambles. The United States emerged as the greatest super power. This is mostly because he United States did not have fighting going on on its own soil. One way to look at the end of world war two is that the United States and other weakened allies created a series of multinational organizations to advance their hegemony. When you look at these organizations this certainly seems to be the case. The United States is the main contributor to the World Bank, and thus has the largest say in its operations. The United States can use the power that it gains by controlling the World Bank to dominate the monetary polices of third world countries. What people don’t take into account when they put forth this idea is the history of the end of World War two. Like I said, the world was in shambles. The economy of the United States was the driving force behind the world economy at the time. Every country in the world knew this, and did not become too distressed over the United States control over these financial institutions because of the power that the US had over the world economy. It made sense for the United States to control the institutions that dictated the world economy, because in the years after World War two, it was the only hope for the continued growth of the world economy.
-Ryan Davenport
I agree with the previous post about how the world had really no choice but to accept the fact that the U.S. had control over these institutions immediately following WWII. However, it is no longer the post-war era. We no longer live in a world where the U.S. can control every aspect of international economics. Our economy is struggling right now, even though some may believe it is not, and we no longer hold vast amounts of foreign debt from virtually every country on earth. Rather, countries like China hold an enormous amount of our debt. The U.S. no longer has the undeniable right to control international economics because we are not the sole leader in the international economy anymore. For a little bit of a wake-up call watch this youtube video called Shift Happens http://www.youtube.com/watch?v=ljbI-363A2Q
-Ryan Pierce
In my opinion the Bretton Woods System is a tool at aiming towards American Hegemony based on the economic practices the organizations it created promote. Capitalism is the key word here, free markets, globalization, those are the ideas that these organizations emplore other nations to participate in. The idea is to implement economic systems in overseas and neighboring countries that will pose as the best benefit to the United States and the other Great Powers. Those organizations will act favorably towards nations that do install beneficial economic systems. These groups like the IMF and the World Bank act as major tools in the game the U.S. is playing to win. This has been going on for decades which is the exact reason why the countries that are major world powers have not changed since World War II.
Jordan Naftzinger
I think it is important to keep in mind why financial institutions like there were created in the first place. There was the Great Depression, and subsequently, economic security dilemmas. There was also the rise of the United States and governmental intervention. The damages to Asia and Europe after World War II were also great travesties. Inevitably, financial institutions such as the World Bank and the International Monetary Fund were created to combat these issues. Whether these institutions create results is a different topic. Some of the benefits include possible elimination of economic dissatisfaction and economic security. Part of the IMF’s mission is to provide financial and consultative assistance to countries experiencing financial crises. However, institutions like the IMF are also criticized for not producing enough policies. There are still massive amounts of poverty across the globe that needs to be dealt with.
-Katy Johnson
I think yes and yes. It could be considered economic colonialism because there is huge profit for the U.S. in these finantial "safety" institutions. But at the same time, the way I understand it is that these institutions prevent global "great depressions". At the same time, some countries can't afford the interest rates and end up worse off than before, or don't have the capitalist mentality and never get the "helping ideas" off the ground. So, the way I see it, the Great Powers make money offering help to those who need it. Sometimes its a win-win, other times its a win-lose.
Stephane Stewart
The WTO is an international organization designed to manage international trade and therefore has many benefits to many different countries around the world. The WTO deals with negotiating and applying trade agreements as well as acting as a kind of enforcement for its members. Many of the benefits associated with the WTO are providing businesses worldwide with clear trading conditions, contributing to international peace, expanding the number of products traded and helping resolve certain issues in a peaceful and constructive manner. Conversely, the WTO has some major negative aspects, one most importantly being the fact that increasing consumption and increasing trade is depleting natural resources and ultimately destroying our global environment. This alone drives me to believe that the WTO’s negative aspects far outweigh its positive ones. As far as creating tools to help the Great Powers dominate the less- privileged ones, I don’t think this is a problem with the WTO because they outwardly claim that they cannot make every country equal. They have, although given smaller countries more voice and increased bargaining power as well as allowing larger countries an easier time negotiating trade agreements. The WTO also allows smaller countries to pool resources and form alliances, ultimately giving them more power than if the WTO did not exist.
Alison Burke
The financial institutions created as a result of Bretton Woods weren't simply a manifestation of American hegemony and economic colonialism. The U.S. came out of WWII economicly strong, with a huge market in war torn Europe, and Europe had no other choice but to accept aid from these U.S. influenced financial institutions. The benefits of these financial institutions are taken for granted and very important such as aiding and consulting countries in economic crises, resolve disputes, and advise on setting tariffs. At best though the benefits balance out the idea that these institutions are for the Great Powers to control lesser states because while the lesser states receive aid, it is at the conditions of these loans that make them economic puppets of the Great Power's financial institutions.
-Brendon Butler
The Bretton Woods system and its subsequent groups are most certainly manifestations of the United States trying to keep itself at the top of the economic food chain. Before World War II, the US and the rest of the world, suffered from major economic depression. The war was what finally lifted it from many countries, including the US. Since the US was one of the major powers that emerged even stronger after WWII, it wanted to ensure its economic status as well. As a result, they organized these institutions to maintain their position of hegemon. While I cannot believe that the World Bank or the IMF are evil institutions (especially since my father is a very respected economist who has done work for both), I am inclined to believe that their focus on the free market, lending processes, and reform programs are aimed at keeping the US on top.
-Meg Gallagher
The creation of the various financial institutions after the World War II period originally had good intent in my opinion. The various institutions like the IMF and the World Bank helped countries that could not otherwise afford or provide this edge themselves. The benefits of these institutions attempt to take some of the anarchical system of all the nation states in the world and create some form of order. Money is one of the biggest causes of agreements and treaties. These various organizations attempted to take some sort of control over these important affairs. The benefits however do not outweigh the fact that superpowers like the United States pretty much dominate this system. Although we like to think that the system is all fair and good, it is probable that America does things mostly in the interest and are able to manipulate many situations due to their high stature in the monetary organizations.
--Mike Poznansky
The World Bank, IMF and GATT are a manifestation of American hegemony and economic colonialism. They are a way for the U.S. and Western Countries to indirectly control countries around the World, through loans and trade. The Bretton Woods system replaced the direct control that existed before World War II, when developed countries controlled the third world militarily and created colonies, protectorates and spheres of influence. Is is no coincidance that the beginning of decononization coincides with the start of the Bretton Woods system. Western powers, faced with revolts in colonies, discovered a better way to control the third world.
Britt Chalmers
Financial institutions such as the World Bank, the IMF and the WTO, created after WWII are with out doubt a manifestation of America hegemony and economic colonialism. These institutions are tiled to favor those counties that are most involved in the operation of these institutions and those countries that financially back these institutions. The United States of America is at the center of both the finances and influence on these institutions. In return the United States receives the best benefits and often leads to America gaining more power from being the back bone of these institutions. Countries get into these institutions, become in more debt and are forced to comply with the regulations set forth by these institutions. In reality these poor countries are complying with what the United States want and are just part of America’s foreign policy and efforts to remain in the privileged position and remain the world’s hegemony. These institutions do provide a quality service that is needed to keep the world in order with one and other but at the same time I feel that these institutions should be set more resembling the UN, as in that the united states does not hold as large of a share of the power and that more countries are involved in the decision making process.
Drew Majerick
The Second World War was the defining moment for the United States' emergence as the economic powerhouse of the world. Therefore it had the power and some say the jurisdiction to oversee the creation of the IMF and World Bank. If a country such as Belgium were to try to assume this position the world would have laughed and nothing would have been accomplished. Granted there has been little success shown as a result of these institutions and economies have collapsed instead. The fact that these institutions are primarily run by the United States is indeed attributed to its desire to exert its economic power. There is no doubt that if the systems were to be reevaluated taking into account the rise of the European Union and Japan as economic powers the systems perhaps would look much different.
---Ryan Shaw
I believe that many of the orginizations set up after World War 2 were, at least initially, well intentioned. However, over the years it seems obvious that countries like the United States, China, and Russia (and a few more) have a much larger say then countries that the organizations were actually designed to help. This is why I feel such organizations are a clear cut example of realism. Countries like the US have a perfect disguise to make it appear as if their goal is to help developing nations, but in reality only help themselves. Under the realist theory, they are not to be blamed. Liberalism would probably claim that these groups are valid organizations attempting to achieve a agreed upon goal, despite their immense failures.
-Gabe DiPietro
Though perhaps the Bretton Woods system has not seen immediate success I agree fully with their goals and policies. Rome wasn't built in a day you know, and neither was Capitalism. It takes time to build up these, many times, near third world countries; but it is a task which must be completed. Compare the Commi/Socialist North Korea with the Capitalist South. Overall life expectancy in the Capitalist South? 82.2 years. And in the Communist North? Just 69.3 years. Though this may not be the best example, I urge anyone to find a country which has lived better since abandoning Capitalism.
The creation of these international monetary systems was originally intended to loan money to smaller nations. Due to the fact that these are international financial institutions, the larger and more affluent nations make larger contributions, thus giving them more sway in terms of decision making. Although this is true, the superpowers of the world take it a step further, using this sway to bring other nations that need loans towards their interests. Because of this, these institutions are becoming less decentralized and more focused on the interests of a select few nations that happen to fund them most.
-Mack Shane
After WWII, many states were left devastated both economically and physically. Thus, this Bretton Woods System was created. I am sure that it was created with good intention, but it can also be argued that the great powers could have exploited the devastated states in the international community. These financial institutions help the international society by providing loans to countries in need of economic help, mostly the rebuilding of infrastructure. The large scale loans come with an equally large scale interest, which will keep the devastated in the clutch of the loaner. If these financial institutions did not exist, I believe the world would not be a better place.
-Ben Choi
There is no easy way for many of the third-world countries to develop without money. Many of those countries get rich from natural resources such as oil. But the other less fortunate counties must borrow the money. It happens in every country of the world. Borrowing money and paying an interest rate does not just apply to states. It is still a business being run. And with this business you have different organizations trying to cash in with different incentives. As one of the wealthiest nations, it makes it easy for the US to mandate many of the rules in the game. Although the GATT supposedly is the most diplomatic, power and money make the tides turn. A single country no matter how powerful, cannot simply shell out billions of dollars with a mere hope of getting it back. Any business model would call this way of business quite delusional.
-Kristian Quiroz-
The organizations that were established after WWII such as the World Bank, IMF, and WTO, were made for a purpose to assist each countries when having financial problem. However, there are many complains about this. The complains are like, the country which has more power and hegemony tends to obtain more benefits. For some aspects this statement is true, however, as the purpose were to make equilibrium few organizations helped alot of countries.
The World Bank provides low-interest loans, interest-free credit and grants to developing countries for many purposes.
Since the IMF was founded, it assisted the worlds finance and technique in a developing world economy.
The WTOs' purpose is to help exporters, and importers to manage their business. They make fair rules between nations to make a well developing world trade system.
There seems to be some incline toward powerful countries such as the US. However, these organizations made this world more active and developed.
There should be a powerful country and a weak country. The important thing is that the powerful country assists weaker countries to remain equilibrium.
-Kim, Hyo Suk-
The establishment of the international organizations that came out of the Bretton Woods System are beneficial institutions. The world needed a system of international monetary management because of the Great Depression, wartime devastation of Europe and East Asia, the rise of governmental intervention and the rise of the U.S. as a major power. The institutions such as the IMF and the World Bank were beneficial because they provided financial assistance to countries experiencing financial crisis. They helped countries that were in need of assistance. Currently however, these international institutions seem to be doing a mediocre job at regulating the international monetary system. The world's poverty rate is at its highest level in history, and nothing is being done to help. It seems that these international organizations are now only benefitting the great world powers, and not the countries who are in dire need of help.
I think that the organizations established after WWII were a good idea for example the IMF, because it helped in the organization of financial situations. It is hard to completely say that countries are not doing a good job in helping the poorer nations because its hard to help and loan out so much money when you have to also keep in mind what is best for your own nation. Everyone must lend a helping hand to make thinks better. Needless to say there are still obviously superpowers that have the wrong incentives, but they are just putting a setback to a struggling nation.
-Jessica Stecker
I think that, even though the creation of these institutions was not at first aimed at American hegemony, they do contribute to it today. What I mean is, the creation of, the World Bank for example, was to help rebuild the European economy after WWII. The IMF's intent was to help countries in financial crisis; the GATT was supposed to increase trade and reduce barriers to trade: all of these institutions are humanitarian efforts to help the global economy, and at the time of their inception, were great ideas, and they have helped many countries in their time. However, because the US is a world power, it became an integral part of all these institutions, and thus the world has become more dependent on the US to help in all these ways. No one can deny that we are pretty arrogant as a country because of this -- which is why we didn't want to give up sovereignty in ratifying the GATT, and which is why it ended up becoming the WTO (in all intents and purposes). So I do believe that the continuation of these institutions is a very big way in which we assert our hegemony in the international system. I do not think, however, that they necessarily benefit as many countries now as we think they do. I remember reading somewhere that most people believe, from learning it in school or from family, that these institutions are helping their countries, when in actuality their countries are becoming poorer, and economically worse in general. Because the people are taught to continually think their country is going to become better, they do not notice that things are not being done. So, I do think that the powers of the world are continuing this cycle of domination over less-privileged countries in the world.
Bretton-Woods regulated monetary relations among independent states and it works because it overlooks all the financial systems of the world to make sure everything is kept in check. These institutions push American free trade values on all countries and helps America become more powerful throughout the world stage. On the other side of the fence, if you disagree with American and want other economic systems Bretton-Woods doesn't work. This system makes America more powerful and over time make other economic systems more and more out of date. Basically, if you are for an American free market, you are for the Bretton-Woods system, while if your against America, you are not in favor of the Bretton-Woods system.
- Eric Goodman
The WTO’s primary function is to improve the welfare its member countries by ensuring that trade is made as freely as possible. By lowering trade barriers and providing a platform for negotiation, countries are able to trade directly with each other without encountering problems that would prevent free trade. The US is guilty of pulling the WTO in their favor, by being the most powerful member state, they are able to allow rich countries to stay rich while keeping poor countries poor, an example of this is allowing countries such as the US to pay their farmers massive subsidies, which poor countries can’t keep up with. On the other hand you have the GATT (the creator of the WTO). I feel that from the time the program became up until present day, the GATT has remained fair to all countries both rich and poor, (although much of the work the GATT did has now been transferred to the WTO). I feel the reason why it appears to be a “fairer” institution is because unlike the WTO it is NOT an organization, but rather a treaty that each country decided was fair for themselves before agreeing to it.
-John Georges
I do believe that all of these International Organizations were manifestations of American power. Why would hey not be? After World War II, we were in the perfect position to do whatever we wanted with the postcolonial world. Even if they were an example of American superpower hegemony, they didn't work out in the end because of the inability of the third world to pay the loans back.
It would have been impossible for the third world to have gotten any worse anyway. The Bretton Woods system was positive in my opinion, simply because it put out there, the idea of American free society and American free market the the rest of the world.
The goal of the WTO is to promote free trade, but the most influential nations possess the most power and are thus able to act in their own interests (at the expense of others who the WTO is "supposed" to help). For instance, rich countries are able to put large taxes on certain imports, making it very difficult for small countries to trade. The WTO also seems to be very in tune to the needs of powerful international companies. It is no secret that the biggest international companies reside in only a relative few of the most powerful nation states. This seems to create an immediate disadvantage for those countries who do not have such businesses. I have also read the the voting system is based on each state's gross domestic product. This alone creates a large gap in the balance of power if you will.
-Mike Werch
While there has been some criticism of large institutions such as the WTO and IMF, I find them to be without merit for the most part. While some will say that these were set up in an effort to make the rich richer, in the end it is in everyone's best interest to become more financially prosperous. The United States and the European Union can continue to use developing countries to focus their economy on services, while the financially poor countries can at began to improve their situation by producing for powerhouses like us. While no institution or organization of these sizes will work 100% of the time, the IMF and WTO help move economic security of nation states in the right direction.
-Matt Swank
It is in my opinion that the World Trade Organization has intentionally limited itself for a number of reasons. As a general rule, the World Trade Organization has rejected addressing issues other than trade. Many argue that the organization should address major world issues involving the environment and labor standards; I could not agree more. Rather than focusing on the world's interest as a whole, the World Trade Organization has instead put it's business interests first; this can be a very dangerous system. Untill the organization can effectively run with the best interests of the world in mind, it is not running correctly.
Kevin Moreno
I believe these institutions founded by the Bretton Woods System are more beneficial than not. Due to globalization and the world getting more connected through trade some international financial institutions were necessary to help maintain some kind of order and understanding between states. The GATT agreement helped take down barriers to trade in the decades after WWII which as noted in the Friedman book holds back economic growth. The IMF and WTO attempt to do the same in pushing free markets. Absolutely some of these organizations have flaws but overall the world has benfitted.
Charles (C.J.) Augustine
I feel that these institutions are a manifestation of American hegemony, although they were not created with this goal in mind. The United States, over time, has come to benefit much from these institutions. Whether it be the expounding of its capitalistic beliefs or improved trade relations with various countries, it is no doubt that the US profits from these institutions.
Nevertheless, America is still subject to the rules and regulations of these institutions as was illustrated in class, at one point. When the US was brought to court, it acquiesced; it could not ignore the demand. Thus, although American dominance is evident, it has much at stake in the system and must uphold its rules; even when it is America breaking them.
--Ashley Mortimer
After World War II at the Bretton Woods conference, the U.S. dollar was established as the capitalist world's principal currency. Originally, the IMF was established to help mend the world's economy after the war, and it did this with U.S. money and influence. With that being said, I think that right off the bat this created a manifestation of American hegemony and economic colonialism through out the world, which is still prevalent today. The institutions established at Bretton Woods push American values and our style of economics.
- Katharine Gray
Originally established these financial institutions were not a manifestation of American hegemony rather a means to re-build economics. I think over time that the divide between the Great Powers and the less-privileged can be perceived in a dominant fashion, however not to the extent of being a mere tool. These institutions hope that with their financial aid that the under-privileged economies might grow. However, such aid intended to help the less privileged is always going to be more beneficial to the already well established economies.
Francesca Carregal
When looking at the WTO, I can't help but think about the Seattle Round where protestors were successful in stifling negotiations among those that attended. Despite the WTO's efforts in making trade easier and cheaper, it still creates disadvantages around the world. These disadvantages, coupled with globalization create the dichotomy of poverty and power. Unfortunately, in economic terms, this dichotomy has to exist in that there will always be winners and losers in trade. No matter how much free trade exists, there will always be competitive advantages in countries, like technology, where it will put other countries at a disadvantage. No matter how much money the IMF pumps into an emerging economy, at some point, the other countries' sound infrastructure will overcome the false economic gains.
Michael Molaski
I believe that while many of these IO's were birthed from U.S. ideas, they no longer represent American hegemony and economic colonialism. The U.S. has given power to these organizations in both forms of moral and expert authority. The U.S. does not hold the puppet strings of these organizations and holds no more control over them than other countries. I think that since most of these organization are led by non-U.S. personnel, the fact that they are not U.S. puppets is further emphasized. Finally, the IMF's goal is not to dominate, but to help. "Great powers" have little actual control over the actions of these IO's, there only power is in their level of support.
Tanner Herpst
I couldn't agree more with the previous statement. The many international organizations that are present today seem to have come from ideas central to the United States. That obviously does not mean however, that these international organizations cannot eventually break free from western idea and run themselves. These systems seem to use American idea as the foundation and framework for their organization but go no further than that. As previously stated, the United States no longer controls the strings of the IO puppet so to speak.
-Ryan Adam-
In response to Luke Kaczmarek's question I beleive that it impossible for everyone to have the standards of living and the economic prosperity as the US has. If everybody has the same standard of living everyone will be paid about the same which would lead to products costing alot more. So the beneifts that are experienced by most Westernized countries would no longer exist. Of course it would be great to see the world as a place where everyone has equal oppertunity; however, i dont think it would be feasable. Competition is necessary to promote the production of better products and inovation in the world.
~Alex Campos
The IMF is, "an international organization that oversees the global financial system by observing exchange rates and balance of payments, as well as offering financial and technical assistance." Upon its creation the goal of this IO was to stabilize exchange rates and construct an international loan system. That problem with this is that most of the largest economies put in the most money for this IO. They also control numerous votes on any decisions that are made. This had led to the larger economies of the world giving off false information of how to create economic growth. Although these are not true what it really does is create a country that either exports to these larger economies or relies on their imports to survive. Then some times they create ridiculous interest rates on the loans they give to these countries. So instead of promoting growth in third world countries instead it just adds to the wealth of the already wealthy.
-Ryan Wallace
Although the original concept of the Bretton Woods System was a good one, (the idea of regulating the international money system in order to keep the economies stable and keep another depression from occurring.) and directly lead to the creation of the World Bank, the IMF, the GATT and the WTO it was, however an example of the power that the US had after WWII. They had the greatest power, both militarily and economically and they made that quite obvious by creating the Bretton Woods System. These systems provide economic security as well as financial aid to countries that were experiencing financial crisis. Although the there are quite a few benefits to these organizations, there is also the negative that it allows America to control the money and aid given out.
-- bethany kravitz
The idea of the Bretton Woods System was an idea that was put together to further America's way of life. It was established after WWII when American production was at a all time high. These establishments such as the World Bank, IMF, GATT, and the WTO were all built to help the American/Western world.
There are many benefits to these institutions such helping Third World Nations get into the trading world, but at the same time these institutions also create problems for Third world nations because they become in debt to these establishments and it becomes hard for them "Third World Nations" to get out of debt. Even though there are bad things about these systems they help keep the peace between other nations and promote American Hegemony.
-Andrew Unthank
When talking about all these organizations it is hard to say if they are good or bad. It seems that they are a mixture of both.
I think they were created with an idea of improvement in mind. And with a lot of aspects in the Western World, they have improved some things. The only problem is that these economic groups become too focused on American interest.
I seem to think the WTO has been the most successful. It is a good organization because the people involved just seem to follow the "rules". I really think the WTO has supported out global economy the most.
-Kimberly Renner
After WWII, Financial institutions such as the World Bank and the WTO were produced to provide a system of rules and organizations after WWII. The World Bank makes loans and to help countries who are struggling and to reduce poverty. I do believe that these institutions and their ideals outweigh the idea that international financial institutions are nothing but simple tools controlled by Great Powers to help dominate the less fortunate. These institutions positive benefits the United States as well as other countries, that come from these financial institutions.
-Brittany Monteiro
The intentions of the Bretton Woods system were good. No country wanted to have another Great Depression. Anything that would prevent this from happening again would be considered great even if there were some draw backs. Since this system could provide that, but also attempt to prevent another World War, seen as attributed to a lack of economic security, it should be welcomed. It was a great idea, maybe a little reform could make it last longer.
-Geoff Andersen
I don't think the Bretton Woods System is all bad, like many commenters are saying. As we learned in lecture, prior to WWII, states would attempt to devalue their currency in order to make their exports more attractive to other states. This, as we learned in lecture, led to the Great Depression. Bretton Woods helped set up a more stable global economic system. Although, we have had recessions, we haven't seen anything like the Great Depression since.
~Josh Shannon
The creation of these institutions was not originally created only to further American Hegemony and economic colonialism. I feel that their original purpose of larger more powerful countries helping smaller and less powerful countries succeed is a great concept.
All three of these organizations have a purpose of helping those who are less fortunate than the larger more powerful nations. However, the more powerful these countries have become the more it seems that these organizations have drifted further and further from the improvement of underdeveloped and smaller countries, and more towards the personal interests of the more powerful nations.
-Amanda McDonnell
I think that these financial institutions were developed with good intentions as well as an advantage to the greater powers. The US for example had a good economy coming out of the war and wanted to help those who did not come out of it as lucky ,however there was a self interest for them such as lowering that tariffs and barriers that they could not get in before the war. Like this over time economic colonialism happened however with developing nations adopting this capitalist idea everyone knows there is self interest involved for their own nations and understand how this economic colonialism could have developed, but I still end with the view that there is moral core to the institutions only because no one wants another Depression for anyone despite the nation they live in, another way morality manifests itself in authoritative power, such as was said in class.
-Michelle Rana
The financial institutions created in the Brettton Woods system are medias through which the rich countries, especially the United States, can promote their authority in the international community. However, this was not the intent when institutions like the IMF and the World Bank were set up. The idea behind the Bretton Woods System was not to show partiality towards a particular country in order to prevent another World war. However the financial institutions are dominated and controlled by the Great powers. For example, some countries do get loans from the IMF and the World Bank, the United Stated and the EU pretty much have the veto power, and they alone can decide which countried get aid. The financial institutions are definetely controlled by the major economic powers and the Global south has tried to change this world order but have failed.
-Roopa Sabesan
After World War 2, the Bretton Woods System was established to regulate monetary policies and trade. These regulations came about from setbacks such as The Great Depression, the rise of power in the United States, and the destruction of Europe and Asia because of the war. Many people believe that the US was just trying to take advantage of their power and get their hands in some of these world institutions. I believe they were just trying to use their power for good to make the world a more stable place.
-Eric Boruta
Unfortunately it has become almost fact that the post WWII Bretton Woods system was designed with the intention of furthering Western influence, particularly the United States. Even today many argue that "free trade" is merely a dressed up term for exploitation in our "globalized world".
While many may question the ability of these institutions to "enforce" their different rules and regulations, today it seems like (at least the economic based ones) no longer have that problem. The IMF clearly is capable of such by limiting/cutting off aid to countries that do not adhere to their "reccomendations". And the WTO has even in recent years forced the United States to change certain policies.
-Nick Sarlo
The Bretton Woods system post World War II, it was set in place to provide financial and consultative assistance to countries experiencing financial crises. This was at the hands of the United States. The US was the strongest country at the time, world war II had the least devastating effects on the US that it did on the other major countries. It was set up to foster gloabl financial cooperation, and facilitate trade. I think that the countries that were leading this were investing the most money in developing nations so that when strong they could have more trade ties with them. It is hard to say what the intentions of the system were, but they it appears that it was in order to create less barriers between countries, but as I said before that appears to have trading intentions for the bigger countries.
--Elizabeth Lodge
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