A Bird’s Eye View: Remember Bretton Woods!
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by Advena Avis
Oluşturulma Tarihi: Mart 14, 2009 00:00
The global financial situation continues to deteriorate. In the United States, the unemployment rate has reached 8.1 percent, which means that 12.5 million humans are unemployed today, the highest number in 25 years. And every day more are being laid off as industries close down all over the world. This means that the stimulus packages that many countries have adopted are either ineffective or have not started yet to show results.
In the EU the situation is equally bad and some of its member-states are on the verge of default. At the informal meeting of the EU heads of states March 1, it was agreed to pursue work on the basis of principles agreed in October, principles that have had no results yet. The global financial crisis it seems will be with us for a long time unless you humans decide to take drastic measures immediately.
We birds, with our birdbrains, cannot propose a solution to the problem, but we can give some food for thought to you humans.
What you do not need any more is useless and expensive meetings of heads of state that usually end with paper statements full of platitudes and generalities that serve no end.
History of Bretton Woods
What might be more helpful and effective this time would be a new Bretton Woods conference that would replace the existing international economic order with a new one or readjust the existing one to today’s realities. The first Bretton Woods Conference met on July 1, 1944, with delegations from 44 countries and established the international economic order that has existed until today. Two humans played an important role in that conference, John Maynard Keynes, the famous economist who was also head of the British delegation and Harry Dexter White, U.S. Assistant Treasury Secretary. The Bretton Woods Conference created the International Monetary Fund, the International Bank of Reconstruction and Development and the General Agreement on Trade and Tariffs, which became the World Trade Organization 50 years later.
A new Bretton Woods Conference may be convened by the G-20 (G-8 + developing countries) with the mandate of establishing a new economic order or readjusting the existing one. Distinguished economists should be included in the national delegations. The conference should give emphasis on reorganizing the global banking system. An idea here would be perhaps to nationalize banks and prohibit them from making profits.
The Islamic banks are not facing problems because they do not use interest rates. This could be a point to reflect on. It is after all, humanity that lends to the banks its money in the form of saving deposits, and it is the banks’ responsibility to safeguard them and not to invest them irresponsibly. U.K. Prime Minister Gordon Brown, who will be hosting the G-20 Summit in London at the beginning of April, has some good ideas toward this direction.
Another idea would also be to revise gross domestic product criteria and broaden it to include the criterion of human happiness. In this way, economic growth will include a human factor that is not taken into account today. Importance should also be given to the developing world, which was not included in the Bretton Woods Conference. Politicians must also realize that the solution to the global financial crisis is long term and will happen gradually after they are out of office. Consequently it is important that they should take into consideration the future of their children and not their own political agenda.
These basic principles, if followed, might be helpful to the London G-20 meeting next month. Our only concern is whether the destructive element of human greed will be able to be neutralized. We are not sure of that.
Ponder our thoughts, dear humans, for your benefit.
We birds, with our birdbrains, cannot propose a solution to the problem, but we can give some food for thought to you humans.
What you do not need any more is useless and expensive meetings of heads of state that usually end with paper statements full of platitudes and generalities that serve no end.
History of Bretton Woods
What might be more helpful and effective this time would be a new Bretton Woods conference that would replace the existing international economic order with a new one or readjust the existing one to today’s realities. The first Bretton Woods Conference met on July 1, 1944, with delegations from 44 countries and established the international economic order that has existed until today. Two humans played an important role in that conference, John Maynard Keynes, the famous economist who was also head of the British delegation and Harry Dexter White, U.S. Assistant Treasury Secretary. The Bretton Woods Conference created the International Monetary Fund, the International Bank of Reconstruction and Development and the General Agreement on Trade and Tariffs, which became the World Trade Organization 50 years later.
A new Bretton Woods Conference may be convened by the G-20 (G-8 + developing countries) with the mandate of establishing a new economic order or readjusting the existing one. Distinguished economists should be included in the national delegations. The conference should give emphasis on reorganizing the global banking system. An idea here would be perhaps to nationalize banks and prohibit them from making profits.
The Islamic banks are not facing problems because they do not use interest rates. This could be a point to reflect on. It is after all, humanity that lends to the banks its money in the form of saving deposits, and it is the banks’ responsibility to safeguard them and not to invest them irresponsibly. U.K. Prime Minister Gordon Brown, who will be hosting the G-20 Summit in London at the beginning of April, has some good ideas toward this direction.
Another idea would also be to revise gross domestic product criteria and broaden it to include the criterion of human happiness. In this way, economic growth will include a human factor that is not taken into account today. Importance should also be given to the developing world, which was not included in the Bretton Woods Conference. Politicians must also realize that the solution to the global financial crisis is long term and will happen gradually after they are out of office. Consequently it is important that they should take into consideration the future of their children and not their own political agenda.
These basic principles, if followed, might be helpful to the London G-20 meeting next month. Our only concern is whether the destructive element of human greed will be able to be neutralized. We are not sure of that.
Ponder our thoughts, dear humans, for your benefit.