Uniting Europe [antikvár]

CHAPTER 1 Introduction PEACE, PROSPERITY, AND THE CHALLENGES OF EUROPEAN INTEGRATION Beginnings: 1945-1949 European economic and political integration began in part as an attempt by European leaders, strongly supported by the United States, to overcome the national rivalries that had led to two world wars in the first half of the 20th century. The main victors on the Western side, the United States and Great Britain, ended the war committed to promoting democracy and political reform in the defeated Axis powers, Germany and Italy. They also sought to establish a more open international economic system to replace the prewar order, which had been characterized by protectionism, competitive currency devaluations, and other policies by which the major powers sought to gain economic and political advantage at the expense of their rivals. At a series of diplomatic conferences in 1944 and 1945, the United States and Britain agreed to establish a new monetary system based on stable currencies pegged to the value of gold, an international bank to promote reconstruction and development in poor and war-torn countries, and an international organization for negotiating lower tariffs and eliminating other barriers to international trade. These understandings led to the establishment, in 1946, of the International Monetary Fund and the World Bank, informally known as the Bretton Woods institutions after the small New Hampshire town in which the most important of these economic conferences took place. The following year 23 countries concluded the General Agreement on Tariffs and Trade (GATT), under which the signatories pledged to lower barriers to trade through negotiations conducted in accordance with the "most favored nation" (MFN) principle. The design of the postwar international economic order reflected what has been called the "universalist" tendency in the American approach to foreign policy—the idea that a single set of rules should apply to all countries and that discriminatory economic behavior and zones of preference be abolished.1 In the monetary sphere, universalism meant the convertibility of all currencies into each other and, indirectly, into gold. In trade, it meant application of the MFN principle, under which each country agreed to grant trade conditions to every other country no worse than those granted to the most favored nation. In both areas,