Wednesday, June 8, 2011

DSK affair - Rethinking Bretton Woods

Let us not to dwell on what is called the "DSK affair" and does not meddle especially our voice to the media speculating endlessly on its direct or indirect consequences for human his family, his country. There will be time to comment on the event when more is known about what happened in New York on Saturday and is now the Director General of the International Monetary Fund (IMF) on a trial in due form before American justice.

Thinking, however, the implications that this case will inevitably affect the governance of international financial institutions. For, beyond the personality of Dominique Strauss-Kahn, beyond the personal tragedy he saw, even beyond the consequences of his arrest, justified or not, will the destiny within France, c ' is the fate of so-called Bretton Woods institutions is about.

Created so that ended World War II, spurred the United States, who felt it essential to reviving European economies devastated by the conflict and especially the necessary containment of communist Russia by liberal powers, the IMF, World Bank and international organizations that are linked more or less remained marked by their origin.

Without going to write that these institutions were a product of the Cold War, we must admit that they were long one of the instruments and even today they remain more or less dominated by the U.S. - and even that left Washington to settle non-US personalities at the head of one or other of these institutions in order to prove they were independent.

The problem is that this mode of governance is seriously questioned for several years and that the affair Strauss-Kahn is likely to be the straw that breaks the camel's back. Many factors combine, in effect, to challenge the existing scheme: the collapse of communism and the end of East-West conflict, the affirmation of China as world's largest economy, the re-emergence of Russia internationally, the continued weakening U.S.

dollar, the euro's breakthrough yesterday and today the Chinese yuan, the banking crisis of recent years that almost plunged the West into crisis as serious as that of 1929, the scramble for raw materials depends on growth in major industrial countries, the rapid penetration of emerging countries into the global economy, etc..

It is obvious that dares to look the truth in the face, that the institutions put in place there are sixty-seven years to organize the global governance under the watchful eye of the United States are largely outdated. And this is without doubt that the chief consequence of the DSK case, we live, stunned, unbelieving, and the first moments.

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