From Bretton Woods and Keynes to 21st century crises: Is there a pilot on board?

Abstract

The Bretton Woods international monetary and financial system ruled the world economy for more than two decades and left a legacy of institutions and practices that are still widely used in international relations. After the end of the fixed exchange rate arrangements anchored on the convertibility of the dollar to gold in 1971, the world began to experience repeated monetary and financial crises of much greater magnitude and duration than those experienced in the two decades following World War II. Moreover, with each new crisis of global magnitude, it became customary to speak of a new international coordination/cooperation and, from the end of the 1990s, of a new Bretton Woods. This article provides a synthetic review of the evolution of the international monetary and financial system in light of the objectives of the Keynes Plan, whose revolutionary aspects had been discarded at Bretton Woods. It argues that this plan contains at least the seeds of an international coordination scheme that could offer avenues of reform to strengthen the stability of the monetary and financial system that constitutes the heart of capitalist economies.