Stage 7 Expanded Reading
In this stage you are expected to broaden your horizon into the topic of the lecture.Please read the following article carefully.
A New Bretton Woods?
When French President Nicolas Sarkozy and British Prime Minister Gordon Brown called for a new“Bretton Woods”agreement in October 2008,they were recalling the success of the International Monetary and Financial Conference held in Bretton Woods,New Hampshire,in July 1944.What Sarkozy and Brown envisaged was a new multilateral agreement to stabilize international finance in the 21st century,the way the 1944 conference,which established the International Monetary Fund and the World Bank,stabilized financial relations among countries in the second half of the 20th century.The summit meeting of world leaders held in Washington,D.C.,in November 2008 started a process that could lead to such an agreement.What would that take to succeed?What kind of leadership,and what kind of commitment,would be needed?History offers some useful lessons.
On several occasions throughout the 20th century,political leaders in major countries sought international agreements on the global economic or financial architecture.Many of those efforts failed,Bretton Woods being the major exception.The central lesson that emerges from these efforts is that successful reform in response to a crisis requires three ingredients:effective and legitimate leadership combined with inclusive participation; clearly stated and broadly shared goals; and a realistic road map for reaching those goals.
During World War II,the U.K.and U.S.Treasuries initiated plans to overcome the weaknesses of the piecemeal interwar approaches by establishing multilateral financial institutions for the postwar period.By mid-1942,the U.K.’s John Maynard Keynes and Harry Dexter White of the United States had prepared first drafts of their respective plans and had begun exchanging ideas to develop a common proposal before the end of the war.Preparations for what would become the Bretton Woods conference began in earnest in the middle of 1943.Keynes suggested limiting participation to a few countries,with the United Kingdom and the United States as“founder states”of the proposed institutions.This time the United States took the broader view.White insisted that delegations from all 45 allies in the war against the Axis be included and be given an opportunity to participate in the drafting sessions and in key decisions.Representatives of 18 countries met in Washington,D.C.,in June 1943 to offer suggestions,and a 17-nation preparatory drafting conference was held in Atlantic City,New Jersey,in June 1944.All 45 delegations convened in Bretton Woods a few weeks later.
The singular success of Bretton Woods is attributable to the extraordinary circumstances in which it was held and to the care devoted to its preparation.Any concerns countries had about threats to national sovereignty posed by the powers given to the World Bank and IMF were effectively neutralized by the twin traumas of depression and war that characterized the interwar period.The willingness of the U.S.government to host the meeting,to take the lead in the design of the IMF,to commit itself to be the principal creditor,and to accommodate the needs of other countries(for example,by accepting the“scarce currency”clause,which imposed requirements on the dominant creditor country)was critical to the success of Bretton Woods.The two-and-a-half-year collaboration between Keynes and White produced many revisions to the original proposals,not just to accommodate each other but also to make the design more appealing to other countries.The unanimous agreement on the Articles resulted from the careful development of a realistic plan,strong leadership from the two predominant countries,the legitimacy that came from an inclusive process,and the effect of a major crisis in stimulating the political will to act.
The planners of Bretton Woods intended to create three multilateral institutions,not two.A proposed international trade organization proved to be too politically divisive,and so a decision on it was postponed until after the war,with nearly fatal effect.As a fallback option,a group of countries established the less potent General Agreement on Tariffs and Trade in 1948.It was not until 1994 that the World Trade Organization came into being.
The exchange rate system was placed under severe strain in the 1960s,and the gold convertibility of the US dollar was officially terminated in 1971.It became apparent that a new monetary order was needed.On several occasions from 1982 to 1985,senior finance officials from France,the United States,and other countries called for a“new Bretton Woods,”although no one ever publicly articulated either the goals for such a conference or a road map for surmounting the failed effort of a decade earlier.Despite the high-level backing,which included French President François Mitterrand and U.S.Treasury Secretary James Baker,the proposal was never acted on.Instead,the G-5(France,Germany,Japan,the United Kingdom,and the United States)—which had largely supplanted the G-10(Belgium,Canada,France,Germany,Italy,Japan,the Netherlands,Sweden,the United Kingdom,and the United States)as the primary steering committee for the industrial countries—acted on its own in 1985-87 to halt the five-year sustained appreciation of the dollar and then to try to stabilize rates around a new equilibrium.
In 1998,the U.S.Congress took the initiative by convening the International Financial Institutions Advisory Commission,which recommended that the IMF stop making longer-term loans and write off its claims on heavily indebted poor countries that are implementing an effective development strategy approved by the World Bank.These recommendations stimulated public discussion—most importantly in the G-7(the G-5 plus Italy and Canada)and then in the International Monetary and Financial Committee,the advisory policy-setting body of the IMF,the successor to the Committee of Twenty(a ministerial advisory body that represented the 20 countries and constituencies of the IMF Executive Board).Those discussions eventually resulted in the adoption of the Multilateral Debt Relief Initiative and the IMF’s Policy Support Instrument in 2005.
The international financial architecture over the past century evolved in response to circumstances of the moment.Formal conferences were occasionally an important element of that process.In most cases,however,institutional adaptation to changes in the world economy came from the interplay of internal deliberations and initiatives from groups of industrial countries.When problems were clearly identified and the major countries agreed on the type of solution required,deliberations within a group of those countries usually provided the necessary leadership for reform.In the most successful efforts,leadership came from a small inner group that was willing to include,listen to,and absorb ideas from a wide outer set of participants.
Each of the major attempts to revise the international financial architecture came in response to a crisis.In the past year,the world economy has suffered a variety of ills,including a financial meltdown and wide fluctuations in the prices of food,fuel,and other basic commodities.Over the longer run,both climate change and the persistence of extreme poverty in much of the developing world are looming crises.
Decisions on which countries have a seat at the table have a major effect on what gets done and what gets set aside.Only the major participants in financial markets—industrial and emerging market countries—can devise new rules for finance,but they cannot by themselves devise new rules for trade in commodities.Nor can they cope alone with climate change or extreme poverty.The more inclusive the participation in the next Bretton Woods,the more likely the outcome will have long-run benefits for mankind.
(Source:http://www.imf.org/external/pubs/ft/fandd/2009/03/boughton.htm)
Task 1:Reading Comprehension Questions
The following questions are asked based on the above article.Please go back to the article and find the answers.
1.Why did Sarkozy and Brown called for a new“Bretton Woods”agreement?
2.What are the factors that may lead to the success of an international organization?
3.What was a key difference between John M.Keynes’s proposal and Harry D.White’s?
4.Why is Bretton Woods successful?
5.What international organizations were established under the Bretton Woods Agreements?
6.What did the exchange-rate system experience in the 1960s,1970s,and 1980s?
7.How did the Multilateral Debt Relief Initiative come into being?
8.How did industrial countries play a role in making institutional adaptation to changes in the world economy?
9.What might prompt a revision of the international financial architecture in the future?
10.Why will the next Bretton Woods require a more inclusive participation of countries?
Task 2:Paraphrasing
Explain in English the underlined words and expressions in the context of the above article.
1.What Sarkozy and Brown envisaged was a new multilateral agreement to stabilize international finance in the 21st century,the way the 1944 conference,which established the International Monetary Fund and the World Bank,stabilized financial relations among countries in the second half of the 20th century.
2.The central lesson that emerges from these efforts is that successful reform in response to a crisis requires three ingredients:effective and legitimate leadership combined with inclusive participation; clearly stated and broadly shared goals; and a realistic road map for reaching those goals.
3.White insisted that delegations from all 45 allies in the war against the Axis be included and be given an opportunity to participate in the drafting sessions and in key decisions.
4.Any concerns countries had about threats to national sovereignty posed by the powers given to the World Bank and IMF were effectively neutralized by the twin traumas of depression and war that characterized the interwar period.
5.The willingness of the U.S.government to host the meeting,to take the lead in the design of the IMF,to commit itself to be the principal creditor,and to accommodate the needs of other countries(for example,by accepting the“scarce currency”clause,which imposed requirements on the dominant creditor country)was critical to the success of Bretton Woods.
6.The exchange rate system was placed under severe strain in the 1960s,and the gold convertibility of the US dollar was officially terminated in 1971.
7.Instead,the G-5—which had largely supplanted the G-10 as the primary steering committee for the industrial countries—acted on its own in 1985-87 to halt the five-year sustained appreciation of the dollar and then to try to stabilize rates around a new equilibrium.
8.In 1998,the U.S.Congress took the initiative by convening the International Financial Institutions Advisory Commission,which recommended that the IMF stop making longer-term loans and write off its claims on heavily indebted poor countries that are implementing an effective development strategy approved by the World Bank.
9.In most cases,however,institutional adaptation to changes in the world economy came from the interplay of internal deliberations and initiatives from groups of industrial countries.
10.In the past year,the world economy has suffered a variety of ills,including a financial meltdown and wide fluctuations in the prices of food,fuel,and other basic commodities.Over the longer run,both climate change and the persistence of extreme poverty in much of the developing world are looming crises.
Task 3:Translation
Read the article again and translate it into Chinese.
阅读文章参考译文：
构建新的布雷顿森林体系？
2008年10月，法国总统尼古拉·萨科齐与英国首相戈登·布朗，共同呼吁签署新的“布雷顿森林”协议，希望重现1944年7月在美国新罕布什尔州布雷顿森林成功举办国际货币金融会议的辉煌。萨科齐与布朗希望通过签订一个新的多边协议，达到稳定二十一世纪国际金融的目的。这正如1944年举行的国际货币金融会议，通过成立国际货币基金组织和世界银行，稳定了二十世纪下半叶各国之间的金融关系。2008年11月，世界首脑峰会在美国首都华盛顿举行，开启了有可能达成类似协议的新篇章。那么，成功的秘诀是什么？需要何种领导方式？需要做出何种努力？对此，我们应该以史为鉴。
在整个二十世纪，世界大国的政坛领袖为了构建全球经济或金融的秩序，曾多次谋求达成国际性的协议，但均以失败告终，只有布雷顿森林体系除外。种种失败后得出的经验教训是，面对危机，要取得改革成功需要具备三大要素：（1）有效的合法领导要与广泛参与相结合；（2）目标要明确且得到普遍认同；（3）实现目标的路线图要切实可行。
两次世界大战的过渡期采用的是零敲碎打的金融措施，为了克服由此带来的缺陷，英美两国的财政部在二战期间，启动了建立战后多边金融机构的计划。到1942年年中，英国的约翰·梅纳德·凯恩斯与美国的哈里·德科斯特·怀特完成了各自计划的草案，并就战争结束前制定出共同方案开始交换意见。到1943年年中，布雷顿森林会议进入筹备阶段。凯恩斯提议，出席会议的国家要限制在少数几国之内，并将英国和美国作为拟议机构的“创始国”。而美国这一次展现出了海纳百川的胸怀。怀特坚持认为，所有反对轴心国的45个同盟国的代表都可以出席会议，并且可以参与草案拟定和重大决策。1943年6月，来自18个国家的代表聚集华盛顿特区，大家会上纷纷建言献策。1944年6月，由17国组成的草案筹备大会在新泽西州大西洋城召开。几周之后，所有45国的代表都出席了布雷顿森林会议。
布雷顿森林体系之所以取得巨大成功，是因为当时情况极其特殊，筹备工作做的格外精细。由于世界银行和国际货币基金组织的权力过大，许多国家都担心会对国家主权构成威胁，但是，战争造成的创伤以及战后出现的经济大萧条，使得这种担忧日渐消失。美国政府愿意主办会议，主导国际货币基金组织的设计，承担主要债权国的责任，满足他国的需求（如接受“稀有货币”条款意味着对主要债权国提出更多要求），所有这些都是布雷顿森林体系成功的关键所在。凯恩斯与怀特进行了两年半的合作，对原先的方案作了多处修改，不仅协调了英美两国的利益，而且对其他国家也产生了更大的吸引力。大会章程获得一致通过，这要归功于精细务实的方案、英美两国非凡的领导力、广纳他国带来的合法性，以及重大危机促成政界精英的有所作为。
布雷顿森林体系的设计者原先计划创建三个而不是两个多边机构。提议中要建立的国际贸易组织，由于政治上分歧太大，因此拖延至二战之后才决定成立，几乎造成了致命的后果。作为过渡性步骤，1948年，一些国家成立了略微逊色的《关税及贸易总协定》。直到1994年，世界贸易组织才正式亮相。
二十世纪六十年代，汇率制度处于风雨飘摇之中。1971年，美元与黄金正式脱钩。显而易见，新的货币秩序亟待建立。1982年至1985年间，来自法国、美国及其他国家的资深财政官员，多次呼吁建立“新布雷顿森林体系”。然而，对于会议召开的目的，如何吸取十年前失败的教训，却无人问津。虽然有包括法国总统弗朗索瓦·密特朗和美国财政部长詹姆斯·贝克等高层人物的支持，但是，建立“新布雷顿森林体系”的倡议从未得以真正实施。相反，五国集团（即法国、德国、日本、英国、美国）凭借自身的力量，在1985年至1987年间遏制了美元连续五年的升值，继而努力将汇率稳定在新的均衡区间。五国集团在很大程度上取代了十国集团（即比利时、加拿大、法国、德国、意大利、日本、荷兰、瑞典、英国、美国），成为工业国家的经济舵手。
1998年，美国国会主动召开了国际金融机构顾问委员会会议，倡议国际货币基金组织停止发放长期贷款，对深陷债务的贫穷国家实行债务减免，因为这些国家正在实施世界银行批准的有效发展战略。这些倡议引发了公众讨论，尤其是在七国集团（五国集团加意大利和加拿大）以及国际货币金融委员会展开了大讨论。作为国际货币基金组织的政策制定顾问机构，国际货币金融委员会接替了二十国委员会（这是一个代表国际货币基金组织执行委员会的二十个国家及选区的部长级咨询机构）。经过多方磋商，最终催生了2005年的多边债务减免行动计划以及国际货币基金组织的政策支持工具。
在二十世纪，国际金融体系的发展顺应了当时的局势。全体成员参加的会议，在那个进程中偶尔会起到了举足轻重的作用。但是在多数情况下，为了应对世界经济变化而做出的体制改革，均来自工业国家的内部磋商与行动计划。一旦问题明确之后，一些大国会对所需的解决方案达成共识。在那些国家举行的内部磋商，通常会成为改革的指导方针。在最成功的改革中，领导力均来自一个小的核心小组，这个小组愿意包容和倾听外部更广泛的参与者，然后集思广益。
对国际金融体系进行的每一次重大改革，都是为了应对危机。去年，世界经济历经磨难，包括金融危机，以及食品、燃油和其他原料价格的剧烈波动。长期来看，气候变化与众多发展中国家持续的赤贫状况，让世界感到危机四伏。
有话语权的国家决定着事务的轻重缓急。只有金融市场的主要参与者，即发达国家与新兴市场国家，才能给金融活动制定新规则。但是，他们无法单方面给商品贸易制定新规则，同时也无法单方面解决气候变化或赤贫问题。在构建下一个新布雷顿森林体系的过程中，覆盖的国家越多，那么，人类共享的益处就会越长久。