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Benn Steil, The Battle of Bretton Woods: John Maynard Keynes, Harry Dexter White and the Making of a New World Order

Donald E. Moggridge
p. 647-650
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Benn Steil, The Battle of Bretton Woods: John Maynard Keynes, Harry Dexter White and the Making of a New World Order, Princeton, NJ: Princeton University Press, 2013, x + 449 pages, ISBN: 9780691162379

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The battle of bretton woods: john maynard keynes, harry dexter white and the making of a new world orderAfficher l’image
Crédits : Princeton University Press

1The Bretton Woods Conference between 1 and 22 July 1944 produced two international institutions, the International Monetary Fund and the International Bank for Reconstruction and Development (now known as the World Bank). This volume is almost completely dominated by the Fund, where the founding story concentrates on the years from 1941 to 1946. Its focus is primarily on the views and activities of the American drafts person of the original American schemes for both institutions, Harry Dexter White, although, almost inevitably, the author of an alternative monetary scheme and the leading British negotiator in the whole saga, John Maynard Keynes, who incidentally re-drafted White's World Bank scheme before Bretton Woods, plays a large role.

2The book begins with a biographical sketch of White's life from his Boston birth in 1892, the son of immigrant Lithuanian parents, through a mixed career including service in World War I before graduating in economics from Stanford in 1924 followed by a prize winning PhD 1930 thesis at Harvard on the working of the pre-war gold standard in France, under the supervision of F.W. Taussig. Another of Taussig's former students with a dissertation on the gold standard, Jacob Viner of the University of Chicago, who was advising Henry Morgenthau, Secretary of the Treasury, hired White for the summer of 1934 to work on a survey of U.S. monetary and banking institutions. White continued his Treasury career with a series of temporary appointments until 8 December 1941, when he was appointed Assistant Secretary of the Treasury. A shorter chapter on Keynes's career and evolving views to early 1941 follows. A discussion of Lend-Lease and its associated commitments for the post war world during 1941 and early 1942 comes. A broadly chronological treatment of the development of the monetary plans associated with both Keynes and White and the subsequent Anglo-American discussions comes next, taking the story through Bretton Woods, the 1945 negotiation of the American Loan to Britain and the first meetings of the Governors of the Fund at Savannah in March 1946. A brief Epilogue carries the history of the Bretton Woods system from the collapse of the regime embodied in the American Loan regime in August 1947 to system's end in 1973.

3To add a certain spice to the tale, the author adds an account of Harry White's 'career' as a Soviet spy, even though this career is peripheral to the Bretton Woods/Loan story for White was only active in the 1930s and, as a result of blackmail, at Bretton Woods. But J. Edgar Hoover's reports of these activities in November 1945 meant that White would not be the first Managing Director of the Fund and he resigned his position as the American Governor of the Fund on 1 March 1947. White died on 16 August 1947 less than 17 months after Keynes.

4The accounts of the issues in which White was involved during his Treasury career are well-written and lively, particularly in its recounting White's successful detailed stage management of the proceedings at Bretton Woods. Steil has picked up on most of the relevant recent literature such as Kurt Schular and Andrew Rosenberg's 2012 edition of The Bretton Woods Transcripts which provides some supplemental documentation to the Morgenthau Diaries and the original Proceedings published by the Department of State in 1948.

5The literature covered in the discussions of Lend-Lease and the emergence of Bretton Woods institutions is largely American. Surprisingly the author does not use the relevant British official history of the period, the late Leslie Pressnell's External Economic Policy since the War, vol. I, The Postwar Financial Settlement (1987), nor its 1956 predecessor, R.S. Sayers Financial Policy, 1939-45 or Sayers's official history of The Bank of England, 1890-1944 (1976) on the Cunliffe quarrel of 1917, Cunliffe's career as Governor of the Bank, which did not end in his resignation as reported by Steil, or the return to gold in 1925. Nor has he used John Fforde's successor to Sayers The Bank of England and Public Policy, 1941-1958 (1992), which has two long chapters covering Bretton Woods, the American Loan and the 1947 crisis from a perspective somewhat different to Pressnell's. Nor does Roger Bullen and M.G. Pelly's Documents on British Policy Overseas, Series C, Volume III, Britain and America: Negotiations of the United States Loan, 3 August - 7 December 1945 (1986) or recent biographies of participants such as Susan Howson's Lionel Robbins (2011) make any appearance. The failure to use such sources instead of the one's quoted has meant that the author has often repeated material from other sources which got the record wrong or confused. But sources such as these are not the only problem. In his discussion of Keynes's appointment as a Director of the Bank of England, he relies on Robert Skidelsky's John Maynard Keynes, vol. 3, Fighting for Britain, 1937-45, (Skidelsky, 2000, 203) which does not tell the reader that Lord Catto, the Bank Director appointed an adviser to Kingsley Wood—the Chancellor of the Exchequer in August 1940—was required to resign his Directorship on taking his new job whereas Keynes, when he met the Governor Norman on 5 September 1941, was handed a note setting out the terms of his appointment, agreed with the Chancellor that 'He would be expected to break off all official or published relations with Whitehall. But unofficially he could continue to be at the disposal of the Chancellor or Treasury. Indeed, the change in his position might be in form rather than in fact.' (The Collected Writings of John Maynard Keynes, XXII, 409; a volume cited by the author). There are also problems with the treatment of earlier parts of Keynes's career which vary from his being 'chosen as a teaching assistant by the storied Cambridge economist Alfred Marshall' (61) to a discussion of Keynes's views and activities surrounding the British return to gold in 1925 that is extremely misleading (74-5), and his suggestion that Keynes in up to 1941 had not taken a firm stand against flexible exchange rates as a desirable system (140) when he never advocated then as a desirable global regime at any time during his career. And the last picture of Keynes in March and early April 1946 pointing 'toward "the invisible hand" as a possible way out of Britain's huge financial problems' ignores the fact that what became Keynes's posthumous article 'The Balance of Payments of the United States' had originated as a paper cabled from Washington to London on 25 October 1945, worked up for publication in January 1946 and submitted to the Economic Journal on 25 January, 1946. It was passed for publication by the Treasury on 2 February, the same day as it formed the basis of Keynes's paper to the Political Economy Club in Cambridge. It is also the case that references to 'the wisdom of Adam Smith' appeared in his House of Lords defence of the Loan Agreement on 18 December 1945 (The Collected Writings of John Maynard Keynes, XXIV, 621).

6Thus one is left with an idiosyncratic but useful volume that should be used with care.

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Bullen, Roger and M.E. Pelly (eds.). 1986. Documents on British Policy Overseas, C, III, Britain and America's Negotiation of the United States Loan, 3 August to 7 December 1945. London: Her Majesty's Stationery Office.

Fforde, John. 1992. The Bank of England and Public Policy, 1941-1958. Cambridge: Cambridge University Press.

Howson, Susan. 2011. Lionel Robbins. Cambridge: Cambridge University Press.

Moggridge, Donald (ed.). 1978. The Collected Writings of John Maynard Keynes, XXII, Activities 1939-1945: Internal Financial War Finance. London: Macmillan.

Moggridge, Donald (ed.). 1979. The Collected Writings of John Maynard Keynes, XXIV, Activities 1955-1946: The Transition to Peace. London: Macmillan.

Pressnell, L.S. 1987. External Economic Policy Since the War, Vol. I, The Post-war Financial Settlement. London: Her Majesty's Stationery Office.

Sayers, R.S. 1956. Financial Policy, 1939-1945. London: Her Majesty's Stationery Office.

Sayers, R.S. 1976. The Bank of England, 1890-1944. Cambridge: Cambridge University Press.

Schuler, Kurt and Andrew Rosenberg (eds.). 2012. The Bretton Woods Transcripts. New York, NY: Centre for Financial Stability.

Skidelsky, Robert. 2002. John Maynard Keynes, Vol. III, Fighting for Britain, 1937-1946. London: Macmillan.

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Référence papier

Donald E. Moggridge, « Benn Steil, The Battle of Bretton Woods: John Maynard Keynes, Harry Dexter White and the Making of a New World Order », Œconomia, 4-4 | 2014, 647-650.

Référence électronique

Donald E. Moggridge, « Benn Steil, The Battle of Bretton Woods: John Maynard Keynes, Harry Dexter White and the Making of a New World Order », Œconomia [En ligne], 4-4 | 2014, mis en ligne le 01 décembre 2014, consulté le 24 février 2017. URL :

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Donald E. Moggridge

University of Toronto

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