by MONA ALI
In this ongoing catalogue of coronavirus-related disorder – extraordinary death tallies, a global lockdown and chaotic financial markets – history reminds us that it is in precisely these conditions that old doctrines are overturned and new paradigms are ushered in.
Crises catapult changes. Amidst this pandemic there are now mass protests across America following the death of George Floyd, an African American, at the hands of a white police officer. The tear gas and ‘show of force’ tactics deployed by the US police on protesters mark a new inflection point in this crisis, highlighting its perils and possibilities.
This moment, if any, clarifies and crystallises the necessity of a new social contract. Whilst economic thinking might appear distant and removed from more immediate concerns, unequal access to finance and other forms of social provisioning has amplified the suffering of marginalised communities across the world.
Now is the time to conceive and construct a new international monetary system, different to the present which furthers the political and economic dominance of a few to one founded on principles of social justice and sustainability. Lessons learned from the past might guide us as we reimagine global money for the twenty-first century.
Bretton Woods and beyond
In mid-century Britain, the Keynesian revolution was catalysed by total war and the active state interventionism it necessitated. Aggregate demand management was adopted in the 1941 budget. The Beveridge Report of 1942 laid the basis for postwar Britain’s welfare state. By 1944, British economic policy had, on paper, committed to full employment.
It was in this context that the conference at Bretton Woods to stake claims over postwar international economic governance convened in 1944. Whilst cultivating an aura of multilateralism, it was primarily Anglo-American negotiations, spearheaded by John Maynard Keynes and the US Treasury Secretary Harry Dexter White, that determined Bretton Woods’ outcome.
Roundly ignored was India – more specifically, its pleas for a greater voting share at the International Monetary Fund (IMF) and enquiries about when its $12 billion sterling balances, more than the entire capitalisation of the proposed international stabilisation fund, would be returned to the subcontinent.
US and UK interventions during coronavirus
The highest number of reported deaths from Covid-19 thus far have been in the US and the UK. In both nations, people of color and BAME groups, who are also disproportionately represented amongst the ranks of ‘essential workers’, have been particularly hard-hit, both by the pandemic and the aftershock of economic crisis. In the UK, according to ONS statistics, Blacks are four times as likely to die from Covid-19 compared to others.
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