University of Southern Mississippi, Mississippi, US
The Bretton Woods system was an economic system that lasted from 1944 to 1973. Before World War I, Britain dominated the global economic market. The vastness of the British Empire caused other countries to adopt Britain’s monetary policy in order to maintain trade. United States’ politicians, however, viewed Britain’s dominance with contempt. Instead, they hoped for a new economic standard with the United States as the prevailing force. From pre-World War I to the 1970s, United States’ politicians saw American interests as prerequisites to global security. In order to perpetuate its role in world affairs, America used the interwar period to replace the sterling with the dollar as the dominant global currency.
This paper examines the Bretton Woods system through the standpoint of economic history. While many economists have referenced the influence of the system, the majority of these examinations deal with the monetary implications of a global economic market. My research, on the other hand, examines why American politicians felt compelled to create a global monetary system under the dollar for the purpose of international security. More specifically, I argue that, while foreign governments viewed it as invasive, American politicians saw an international economic system under the dollar not only as a means of economic stability but as a form of militaristic peace.