The world economic system that operates at today was born with the adoption of the “White Plan” at the Bretton Woods (New Hampshire, USA) conference in July 1944. The International Monetary Fund, The World Bank, and the World Trade organisation grew from The White Plan.
The world was a different place in 1944. World War II was still in progress; Europe was on its knees; governments administered over economies geared solely towards waging war; and the civilian economic concern was survival.
The United States of America was heavily involved in the war effort but maintained an economy not affected by destruction of infrastructure. Not only that, but America was being paid for the armaments it produced and supplied for its allies. In many ways this was a blessing in that the allies in Europe had supplies of armaments that could not be interrupted by the Nazis. But it did give the USA a disproportionate say in economic matters.
Harry Dexter White
The author of the White Plan was Harry Dexter White who was a senior official at the US Treasury at the time of the Bretton Woods Conference. Harry Dexter White had a “colourful” career.
White was the son of Jewish/Lithuanian Catholic immigrants, Joseph Weit and Sarah Magilewski. His surname White was the Americanised version of Weit.
White served in the US army in the Great War before enrolling in university to study economics. Nominally he was a Democrat in the “New Deal” style but was said to be a Stalinist sympathiser.
One of the many things that White was accused of was hiring members of the Communist Party to positions within the Treasury, and of being a member of the Communist Party himself.
More damning are the accusations that he was author of the sanctions and ultimatums that left Japan in the position of commencing war against America or slowly starve to death. On the November 25, 1944, the US Secretary of War, Henry Stimson, is said to have asked “how we should manoeuvre them into the position of firing the first shot”. It was the 10-point ultimatum to Japan largely written by White that provided the answer.
Harry Dexter White was also the originator of the Morgenthau postwar plan that was initially accepted by Roosevelt but withdrawn due to public pressure. The Morgenthau plan was that after the war Germany's industry should be destroyed and Germany would become a purely agricultural economy. In the words of the day Germany should become a “potato patch”. The Morgenthau plan was used by the Nazis as propaganda and is credited with having prolonged the war. This policy was continued undercover.
By late 1946, however, economic hardship and unemployment in Germany were worrying the United States, and former President Herbert Hoover was sent there on a fact-finding mission. Hoover’s third report of March 18, 1947 noted: “There is the illusion that the New Germany left after the annexations can be reduced to a “pastoral state”. It cannot be done unless we exterminate or move 25,000,000 people out of it.” Hoover well understood that an agricultural economy would be able to sustain a much smaller population than an industrialised nation. ("The Marshall Plan at 60: The General’s Successful War On Poverty" By Erik Reinert and Jomo K. S. UN Chronicle.)
In 1947, while being investigated by the House Committee on Un-American Activities on the charge of being a member of the Communist Party, White died of a heart attack. This accusation then escalated to the charge of supplying the printing plates that allowed the Soviets to print American Military Marks (the military occupation currency), thus causing rampant inflation in Germany that cost the USA a quarter of a billion dollars to fix. The accusation was made in 1948; by a defecting Soviet spy Elizabeth Bentley.
White may have been a victim of the “Red under the bed” hysteria created by Nixon/McCarthy that resulted in many innocent lives being destroyed.
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