alternatehistory.com

For those who don't know, the Bretton Woods conference in 1944 set up the basis of postwar financial order and created several institutions like the International Monetary Fund and the World Bank to ensure financial stability. The most lasting legacy of the Breton Woods conference was the adoption of the US dollar as international reserve currency. However, the United Kingdom proposed the adoption of a new international currency, called the bancor, that would be used as a reserve currency exclusively to deal with international trade. This currency would be regulated by an institution called the International Clearing Union that would oversee all international trade:
The Bancor was a supranational currency that John Maynard Keynes and E. F. Schumacher[1] conceptualised in the years 1940-42 and which the United Kingdom proposed to introduce after the Second World War. This newly created supranational currency would then be used in international trade as a unit of account within a multilateral barter clearing system – the International Clearing Union – which would also have to be founded. The Bancor was to be backed by barter and its value expressed in weight of gold.

The International Clearing Union (ICU) was one of the institutions proposed to be set up at the 1944 United Nations Monetary and Financial Conference at Bretton Woods, New Hampshire by British economist John Maynard Keynes. Its aim was to have been regulation of currency exchange, a role eventually taken by the International Monetary Fund (IMF).
The International Clearing Union (ICU) would be a global bank whose job would be to regulate trade between nations. All international trade would be denominated in its own currency, the proposed bancor. The bancor was to have had a fixed exchange rate with national currencies, and would have been used to measure the balance of trade between nations. Every good exported would add bancors to a country's account, every good imported would subtract them. Each nation would be incentivized to keep their bancor balance close to zero. If a nation had too high a bancor surplus the ICU would take a percentage of that surplus and put it into the Clearing Union's Reserve Fund; this would encourage nations with surpluses to buy other nations' exports. Nations that imported more than they exported would have their currency depreciated against the Bancor; encouraging other nations to buy their products, and making imports more expensive.

These proposals failed because the US saw no point in creating a new made-up currency with a silly name out of a cheap sci-fi novel that would not actually exist when there already were perfectly good dollars around to act as reserve (and Congress would never pass a measure that would give control of international trade to an unelected international body). The bancor and ICU proposal, however, is symptomatic of the liberal mindset that existed toward the end of WWII once Germany's defeat was seen as a matter of time, of a new liberal world order where international institutions would take over many functions that had until then been the prerogative of nations. The US and the Soviet Union's omnipotence after 1945 and their understandable negative to play by these rules would put a swift end to this.

However, what effects would the adoption of these measures have in postwar economies? Would the Soviet Union be willing to play along? Even if the United States rejected it, would it make sense for a group of countries, maybe led by the UK to adopt it?
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