Most Modern Age of Globalization- Bretton Woods

Most Modern Age of Globalization- Bretton Woods

Globalization in most recent history can be summed up with one easy agreement made right after World War II, when it was apparent, that with the need of a worldwide peace organization, such as the United Nations, an international financial organization would need to exist too.

Globalization in most recent history can be summed up with one treaty made right after the Second World War. After the Great Depression tore apart most of the world, it was realized that along with an international peacekeeping organization, an international financial organization was also needed in order to prevent another Great Depression from happening (Ritzer).

The Bretton Woods System was a meeting held in 1944 to discuss ways of preventing another economic meltdown on an international scale by setting standards and tariffs that were fair for everyone, which had not existed before. In the decade leading up to the Great Depression, American farmers suffered without the ability to sell off their crops to markets outside of America, because of America’s own high tariffs and other country’s tariffs (Boyer).

The Bretton Woods conference established the International Monetary Funds (IMF), along with setting a currency standard backed by the American dollar, “par value” of one’s currency expressed in gold and exchange rates (Ritzer 58-9).

While one can go on for a while just discussing the merits of the Bretton Woods System by itself, when some focus should be placed on how the system brought the world closer together, in the name of globalization.

Before such an organization existed, not much was bringing the world closer together; closer to forming what we know as today’s international economic ties. Every country was left to fend for itself in times of need.  But with these measures taken by the Bretton Woods System, the world economy will have less of a chance of falling apart if countries have the ability to help each other out.

While there are goods sides to the system, there are also bad sides. During Nixon’s presidency, he took America off the gold standard, causing problems with the global economy. It was then, when Bretton Woods ended, even though a lot of the policies still exist today.

But critiques against the System include the IMF and how some of it was mismanaged, including the austerity measures taken in poor countries. Or how countries are now starting to turn in on themselves rather than trying to work as a global community.

But in the end, it was because of the Bretton Woods System that globalization in the most recent age has started. Now, every market in the world reflects what is happening around them, good or bad or in between.

Columnist: Cassie Sullivan

Editor by: Sunshine Sowers