"The myth of Bretton Woods"

[This paper is] a discussion of the transformation of the international monetary system in the period immediately following the adoption of the Bretton Woods agreements. The Bretton Woods architects intended to fashion an international monetary order that would provide maximum autonomy for national economic policy, upending the priorities of the classical gold standard. This emphasis on national prosperity was reflected in the contemporary analyses of both Karl Polanyi and Ragnar Nurske each of whom argued that domestic economic stability needed to form the core of the new international economic system -a concept later termed "embedded liberalism" by John Rugge. But the system finally agreed at Bretton Woods was already considerably weaker and less coherent than the original plans of either John Maynard Keynes, the chief British negotiator of the accord, or Harry Dexter White, his American counterpart Disagreements within the Roosevelt administration resulted in a much more ambiguous formulation than either of the two original architects desired, particularly on the issue of control of capital movements. Soon the infant system faced challenges not only on this front but indeed on all its major postulates. Within a generation, the practices of "the Bretton Woods system" were so completely different from its founding precepts that even leading scholars had confused the two-and not just superficially