World Bank: Found transcripts reveal birth of IMF

Lost for decades before their chance discovery by a US official, the raw transcripts of the Bretton Woods conference reveal the difficult birth of the International Monetary Fund and World Bank in 1944. "I was looking in the Treasury library for some other material which was nearby and I noticed that there's a section labeled uncatalogued material... and so I was curious to see what was in it," Kurt Schuler, a US Treasury economist, told AFP. The economic history buff picked up black volumes labeled "The United Nations Monetary Financial Conference," the official name of the conference held in Bretton Woods, New Hampshire, and dated July 1 to July 22, 1944. Combing through hundreds of dusty pages, Schuler discovered exchanges, some tense, among the delegates of 44 nations who laid the foundation amid World War II of an international financial system proposed by Britain and renowned British economist John Maynard Keynes. Schuler said he found remarks by Keynes in the transcripts that had never been published. "That was when I knew that it was possibly important," he said. Two years after the discovery, "The Bretton Woods Transcripts," edited by Schuler and Andrew Rosenberg, has brought "this treasure trove" to the public, said Jacques de Larosiere, a former IMF managing director (1978-1987) and Steve Hanke, an economics professor at Johns Hopkins University, in the book's preface. "Even though there have been thousands and thousands of pages written about the Bretton Woods conference, nothing beats the transcripts for a first-hand feel of what transpired," they wrote. The key insight given up by the unearthed transcripts: the debates of nearly 70 years ago look very much like those heard inside the IMF today. "In spite of the very eloquent and moving speech of the United States delegate... the quota proposed for my country is entirely unsatisfactory and unacceptable," said an Iranian official. The Chinese delegate also opposed the US proposal on quotas, which determine voting power, while saying, "I hesitate greatly to sound a note of discord at this conference." The major economic powers were hardly united on the grand shape of the future Fund. "It is, therefore, with great disappointment that we have noted that the quota which was just established does not meet our expectations," said Pierre Mendes France, representing the Provisional Government of the French Republic. For him, the system did not recognize the position of influence that France as well as some other countries "will probably occupy again in the postwar world." The book is of great historical value because it shows how the United Nations, then in prototype, managed the creation of international consensus, said Eric Rauchway, a history professor at the University of California, Davis. "We tend to think of Bretton Woods as a US-UK stitch-up, but this isn't quite right -- the USSR had a larger role in setting the parameters of the arrangements than we'd previously thought, and this comes out in the debates," Rauchway told AFP in an email. "So too do the concerns of the emerging countries," he said, noting that they wanted to get regional representation on the governing bodies of the IMF and World Bank. "We believe that the Middle East countries as one economic unit should be represented by one seat. I need not urge you for the small countries to be well represented," said Egypt's representative. His plea was rejected. Beyond revealing the differences that existed between delegates behind closed doors, the transcripts shed light on the embryonic stage of the international community just one year before the creation of the United Nations. "It marked an approach of economic cooperation that was much different from the pre-war approach," said Schuler.