Yet that era also bequeathed to us some new problems.What we now call the European Union grew out of a postwar Franco-German coal and steel trading pact.In today’s letter we are going to look closely at the International Monetary Fund and a scathing report from its own internal auditors.For those of us who have been following the IMF for decades, the report is not all that surprising.The euro currency is a branch in the same family tree as the World Bank, the International Monetary Fund, and others.
Theories and practices often outlive their usefulness in our fast-changing world.
So do institutions, including those chartered at the 1944 Bretton Woods Conference.
My real purpose here is not to point the finger at the IMF but to point out where its problems are part and parcel of a greater problem in global institutions.
During the next global recession we are going to see a continuation of the same approaches to crisis solving that we’ve seen in the past, based on the theories of defunct economists mixed with personal and institutional biases.
Their prescription is a witches’ brew that we will be told is good for us but that will in fact ensure that those of us least able to cope will bear the brunt of its impact. In a war-torn world that had yet to recover from a depression that began 15 years earlier, revamping the existing economic order probably seemed a good idea.
And the results did look positive for the first few decades.