Unrealised ideals the other side of global governance from 1942 to 1950

Joseph Mitchell Unrealised ideals: global governance from 1942 to 1950

Unrealised ideals: the other side of global governance from 1942 to 1950

This is an essay about a narrative not told. It concerns great moments in history that never
happened. It forms a foil to such works as ‘Act of Creation’ by Stephen Schlesinger, whose title
not-so-subtly hints at the god-like nature of the architects of our post-war world. But these
architects were not gods, they were men. And as mortal beings they could fail. Some would see
their innovations in institutional creation smashed against the hard realities of power,
suffocated as the oxygen of idealism dissipated into the post-war context and abandoned as
states retreated to pre-war ideals of national interest and state sovereignty.

The essay is in two parts. The first part will examine the proposals for three global institutions,
made during or immediately after the second world war. For each unrealised institution, a short
intellectual history is given, followed by an explanation of what became of each one, and a brief
counterfactual suggestion as to what might have been. The second part will ask why these
institutions were not realised. It suggests firstly that the fraternal moment in time created by
the atmosphere of war was short-lived, secondly that individuals, cognisant of that moment,
could only do so much and often overreached their ability or capacity to make change, and
thirdly, that as that moment dissipated, the world saw the return of realpolitik and national self-
interest.

It concludes by briefly assessing the institutions’ intellectual remains, and suggests that their
failings provide us with lessons for future institutional creation. In an era where better global
governance is urgently required, the experience of this post-war time should guide us in
advance of the dawn of any new creative moment.

Part one: Global governance institutions that never were

The three institutions considered here are Keynes’ version of the Bretton Woods system of
global economic governance, Boyd Orr’s World Food Board, and the International Trade
Organisation, all of which were envisaged and unrealised within the period from 1942 to 1950.

1.1. Keynes’ Bretton Woods

Nestled in the New Hampshire woods, somewhere in the grounds of the Mount Washington
Hotel stands a green sign, commemorating the ‘Bretton Woods Monetary Conference’. This title
is technically incorrect, but perhaps better suits what happened. The United Nations Monetary
and Financial Conference was in reality a show run by the United States from start to finish. The
institutions created there in 1944 have become symbols of Western imperialism, are the focus
of regular criticism from civil society organisations, and perhaps worse, are in danger of being
left behind by regional replacements. However, the International Monetary Fund and the
International Bank for Reconstruction and Development were not the only institutions to be
proposed at this time. Two other proposals, one for an International Clearing Union and the
second for an altered International Monetary Fund, may have led to a very different history of
global monetary governance.

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The International Clearing Union was proposed to the House of Lords in the UK Parliament by
Lord John Maynard Keynes in his maiden speech before the Chamber:

“The principal object can be explained in a single sentence: to provide that
money earned by selling goods to one country can be spent on purchasing the
products of any other country. In jargon, a system of multilateral clearing. In
English, a universal currency valid for trade transactions in all the world.
Everything else in the plan is ancillary to that.”1

This rather simplifies his mission to stabilise or equalise the terms of trade around the world.
The union would take the form of a central body that would award an amount of international
currency to each member based upon their trade history over the previous five years. At the end
of the trading year, those nations that had a negative balance of payments, i.e. who had
imported more than they had exported, would be able to draw down on the credits in order to
pay their creditors. Those nations who had a positive balance of payments would add to their
credits. In both cases, repeated imbalances would be discouraged by a system of interest
payments, transfers and ultimately currency adjustments.2

The union would have benefited the European nations whose economies were severely
damaged by the war, essentially providing a large overdraft facility needed to cover the
expected deficits in their balances of payments. It would have encouraged the American
nations, both North and South, who were the main suppliers to post-war Europe not to hoard
their surplus earnings, but to spend them. The union was also designed to encourage
transparency, as it would need to keep a record of all members’ imports and exports and thus
their creditor or debtor status. In turn, it was hoped that this information would prevent
competitive currency devaluations and thus take a form of ‘financial disarmament’ in the same
way that the Atlantic Charter had already proposed military disarmament.3

The union was never established, as outlined below, but Keynes had other proposals for the
institution, the International Monetary Fund, that rose in its place. After he was appointed the
United Kingdom’s representative at the fund’s first conference in Savannah, Georgia, he
proposed to the assembly that the institution must be headquartered in New York. This would
add to the institution’s international credibility, help ensure that a balance of voices be heard,
and enable greater ties with the United Nations, especially the Economic and Social Council.
Keynes went on to argue that the fund’s management board should be staffed by part-time
leaders of national finance ministries, in order that its policy would be directed by national
concerns. He envisaged the fund as the servant of nations, not the master.4

White’s victory

Keynes got his way on neither account. In the early 1940s, while Keynes worked on his plans for
the union, Harry Dexter White was working on milder, more US-friendly proposals for the
international monetary order. White, like his boss, US Treasury Secretary Henry Morgenthau,
was not averse to Keynesian economics, but the importance of government spending and full
employment was never held in the same regard in the United States as it was in Europe. More
importantly, the US treasury officials were not prepared to provide the vast reserves that
Keynes’ union would require. Instead, White envisaged an International Monetary Fund in
which members would fix their exchange rates to the dollar, which was convertible to gold, in
order to prevent nations from competitive currency devaluation. The risk that Keynes foresaw,

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of severe imbalances in the terms of trade, was not mitigated with a sufficient funding facility
that would enable debtor nations to continue to seek full employment. For example, Keynes’
plans suggested that the fund hold reserves of up to 75% of the value of pre-war trade; White’s
suggested closer to 10%.5

It was White who carried the day at Bretton Woods. By virtue of organising the conference, the
agenda was arranged to ensure that Keynes chaired the commission on the International Bank
for Reconstruction and Development. It was thus difficult for him to negotiate on the fund at the
same time. By the end of the conference, Keynes had not had the time to examine the decisions
of the commission on the fund before he signed it off as the lead British delegate. Despite this,
some elements of the union would live on in the Fund, such as some flexibility on exchange rates
in the event of severe imbalances.6

White had a fuller, swifter victory at the first International Monetary Fund (IMF) conference in
Savannah. The US, supported by what Keynes referred to as Latin American and Chinese
‘stooges’, established that the Fund would be headquartered in Washington, and Keynes’ pleas
for management by part-time representatives of member nations was rejected in favour of well-
paid, full-time positions with no specific duties for the fund’s managers. Keynes predicted this
would result in the positions becoming retirement postings for international bureaucrats. The
IMF was established ‘a five minute walk’ from the centres of US government power: the White
House and the State and Treasury departments. As Kemal Dervis wrote, fifty years later: ‘there
is little doubt...that the involvement of the US government...in week-to-week operations of the
Bretton Woods institutions goes much beyond what the seventeen per cent voting power of the
US would suggest’.7

An alternate post-war economic order

Counterfactual history is a difficult thing. It risks becoming unsupported conjecture. But for
each institution, some brief suggestions are helpful in driving home the importance of
considering these issues at all. These risks noted, there follow some thoughts on Keynes’
Bretton Woods.

Had the world followed Keynes’ vision for a union, a hugely well-resourced international bank
would have been established, acting as a lender of last resort - a kind of central bank for the
world. Further, by creating a system that strongly encouraged all states to move towards
equilibrium in their balance of payments, the clearing union may have lessened the dollar
shortage that quickly arose after the war due to vastly positive balance of payments that the US
ran post-war. The IMF in reality had little concern for what creditors got up to, prioritising
currency stability over full employment.

Keynes recognised something that US officials have only recently awoken to in their critique of
contemporary Chinese monetary policy: there are two sides to every trade imbalance. It is not
only the behaviour of debtors that matters, but creditors too. The dollar shortage would have
been avoided by Keynes’ system, which did not rely on gold. This would have allowed for
greater liquidity in the monetary system, and avoidance of the real Bretton Woods system’s
collapse in 1971. The ongoing financial crisis in the West may ultimately relate to these events:
a clearing union may have devalued the dollar and raised the Renminbi long before China’s
enormous dollar surpluses led to asset bubbles in US sub-prime mortgage markets.8

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In sum, on the post-war international monetary order, Keynes was defeated by White, which led
to the creation of new Washington-centric institutions. The second part of essay will examine
why White triumphed over Keynes.

1.2. Boyd Orr’s World Food Board

The second institution considered here is the World Food Board, an intellectual product of the
second world war and the Roosevelts’ idealism. In 1941, the President gave the State of the
Union address, which became known as the ‘four freedoms’ speech. The third of those freedoms
was ‘freedom from want’. Due in part to the efforts of two Australian food scientists - one of
whom had proposed a ‘marriage of health and agriculture’ at the League of Nations and
corresponded with the First Lady on the subject – Roosevelt decided that the first UN
conference would concern food and agriculture. At Hot Springs in 1943, allied nations agreed
that that ‘the world has not had enough food to eat’ and that this was due to lack of incomes and
productivity rather than any Malthusian view of population growth. They agreed to meet in
Quebec in 1945 to establish the UN Food and Agriculture Organisation (FAO).9

One of attendees at Quebec was the nutritional scientist Sir John Boyd Orr who had helped
establish nutrition guidelines before and during the war. Though not even an official delegate,
having upset the British government with his claims about the malnourishment of British
children, he was appointed as Director-General for a shortened term. He was the eighteenth
choice of the delegates present. His election is described as a reaction to his remarkable
oratorical ability. Invited to address the assembly, he told delegates that ‘'if the nations cannot
agree on a food program affecting the welfare of people everywhere, there is little hope of their
reaching agreement on anything.”10

Boyd Orr saw hunger as the world’s greatest problem. Hunger jeopardised any chance of peace
as it was a precursor to social unrest. Everywhere he looked he would find it. In the immediate
aftermath of the war, Europe faced severe food shortages: much of Italy and Germany was
surviving on food aid provided by the UN’s Relief and Rehabilitation Agency. Three years earlier
the Bengal famine had taken an estimated 2-4m lives in British colonial India. In FAO’s first
World Food Survey in 1946, he found that one third of the world’s population were not
consuming a sufficient daily calorie intake. He stated that people would look to FAO for food, but
they would find only statistics. Boyd Orr was first a scientist, never a politician. He viewed
problems empirically and could prove that a solution to hunger existed. Thus he determined
that the organisation would require a permanent executive agency to urgently improve world
nutrition. He was invited to suggest such a body at the first formal FAO conference in
Copenhagen in 1946.11

His answer was the World Food Board, for which he suggested three roles. Firstly, it would
establish buffer stocks in order to stabilise prices. This would mean that the board would set
maximum and minimum prices for commodities, and release or buy up stocks for storage as
appropriate. This was aimed at ending the pre-war commodity price volatility, which would
allow farmers to make more secure production plans and ensure a steady price for consumers.
Secondly, faced with a growing world population, Boyd Orr knew that production must increase
in the developing world. The board would provide large capital funds to developing countries
on affordable, long-term rates. Boyd Orr argued that estimates of a nation’s current capacity to
repay the loans should not be seen as crucial, because only properly-nourished people could

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develop an economy that would generate enough revenue to repay a loan in the future. Thirdly,
he recognised that at times it would be necessary to provide food in an emergency, even if the
recipients had little hope of paying it back – the new world should not see its peoples’ starve.
This would be funded from any surpluses generated by the buffer system.12

A swift put-down

The idea of the World Food Board met with muted approval at Copenhagen and was then killed
in committee. The United States’ delegate in Denmark damned the proposal with faint praise,
saying that the US wholeheartedly supported ‘the general objectives’ of the board. Many of the
other delegates stated that they agreed with the ideas ‘in principle’. The result was agreement
only that they would found a committee to develop the proposals further. As soon as the
committee began its hearings in Washington, the US made it clear she would not support it, and
was joined by the United Kingdom. The committee looking into the proposals reported back that
while food markets were global in character, and while there were deficits in developing world
and something should be done about these, they favoured bilateral agreements over any kind of
world plan. The FAO was confined to exactly what Boyd Orr had argued against: a production
house for leaflets and statistics, lacking any binding authority.13

Opportunities lost

The absence of a World Food Board had three effects: lost decades in poverty reduction, an
increased likelihood of politicisation of food aid and slower innovations in development finance.
Firstly, it was 15 years before the World Food Programme was set up as a multilateral supplier
of emergency food aid. As Boyd Orr might have considered it, those were fifteen years of lost
development opportunities, further worsening poverty. Secondly, the proliferation of food
bodies, such as the US’s Food for Peace programme, led to a bilateral approach, allowing
institutions to be led by political and domestic goals as opposed to universal, scientific goals.
The US is still criticised for dumping its food surpluses on the world market as ‘food aid’, which
risks ruining farmers more local to the famine, who may be able to produce supplies more
cheaply. The World Food Board, and buffer stocks, stabilised prices and a multilateral aid
approach from the start, may have prevented this. Thirdly, Boyd Orr’s long-term credits plan
was farsighted: similar length World Bank loans were only available years later, were smaller
than Boyd Orr envisaged and were conditional. Only very recently has the future economic
value of a more healthy generation been accepted as a reason to ‘front-up’ additional
development spending, as in the work of the High Level Taskforce on Innovative Financing for
Health.14

Global food policy, food security and food aid have never stopped being controversial issues.
Debates rage on the effectiveness of the institutions, the political nature of donations, the
benefits to developed suppliers and the effects on developing markets. It cannot be assured that
the board would have avoided these controversies, but critically, it would have had a head start
on today.

1.3. The people’s International Trade Organisation

The International Trade Organisation has perhaps the longest intellectual evolution of the three
unrealised institutions considered here. President Woodrow Wilson’s programme for world
peace, given in his ‘fourteen points’ speech at the end of the first World War, had featured a

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clause suggesting the ‘removal, so far as possible, of all economic barriers and the establishment
of equality of trade conditions among all the nations...’. With these words, Wilson helped create
the American view that free trade would build up strong relations between nations, making
peace more likely. Cordell Hull, US Secretary of State from 1933 to 1944, took up Wilson’s
suggestion, and had, in 1925, proposed the idea of an International Trade Organisation. In the
course of the second World War, it was considered that it was time for Hull’s idea to be
fulfilled.15

The US considered that the trade organisation would form the third part of the new economic
order alongside the International Monetary Fund and the International Bank. A charter was
drafted and shared with the UK in 1944 and conferences were arranged in London and Geneva
for international negotiation. At this time, Keynesian economics was still held in high regard; it
suggested that there should be limits to the laissez-faire attitude to trade. For example, nations
should be able to restrict trade should it suit their strategy for reaching full employment.
Indeed, the meetings at London, Geneva and then Havana were the United Nations Conferences
on Trade and Employment.16

The remarkable story of the International Trade Organisation (ITO) negotiations was that over
the course of two years, the assembled nations managed to balance the aspects of free trade and
full employment; the international and the national interest. Even more remarkably, partly due
to the work of the delegation for the newly-independent India, the demands of the developing
world for a chapter on development in the Charter were met. This allowed for infant industry
support and the possibility of expropriation, to the alarm, but not the exit, of the US delegates.
The result was finalised at Havana in 1948. Fifty-six nations signed the Charter of the
International Trade Organisation. Despite being the closest of the three institutions to be
fulfilled, it too was never realised.17

Two-speed negotiations

The negotiations of the charter had been divided in two at Geneva. The chapter on tariffs,
quantitative restrictions, subsidies and state trading was separated from the rest of the work on
the treaty, partly because tariff negotiations had to be kept secret from the markets and partly
because the US Reciprocal Trade Agreements Act, passed during the depression by a Congress
desperate to boost the US economy, gave the US president powers to arrange tariff reductions
without the Senate’s approval. The rest of the charter, however, required two-thirds support for
ratification by the Senate under normal treaty rules. As a result, when the charter was signed in
Havana, the chapter forming the General Agreement on Tariffs and Trade could immediately
come into effect, which removed the incentive for the Truman administration to press the
Senate to approve the rest of the treaty. Although Truman did submit the full treaty to the
Senate, this only happened in April 1950, partly due to competing legislative pressures, such as
the Marshall Plan. Two months later, the UN and US went to war in Korea, and the Havana
Charter was permanently withdrawn. The General Agreement on Tariffs and Trade morphed
into the de facto body for world trade negotiations, replaced by the World Trade Organisation in
1995.18

A marriage of trade, employment and development

Daniel Drache has argued that the unrealised Havana Charter was a unique opportunity for the
marriage of three fields: trade, employment and development, often contemporaneously seen as

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competing goals. He argues that the ITO represented a global trade system in which
untrammelled free trade was not understood as a good in itself, but as something to support
employment and development, each of the three elements working in each other’s favour. It was
an international work of careful compromise, granting national leaders the power, within limits,
to do what they thought best for their economy.19

Another example of the charter’s unifying nature can be found in chapter eight, which provides
that ultimate jurisdiction of trade settlements lies with the International Court of Justice, the
new court created by the Charter of the United Nations. This could have dramatically altered the
divide between private and public international law that exists today. It provided for
multilateral, rather than bilateral solutions, which have become so important in contemporary
trade. Furthermore, the charter also contained a chapter on restrictive business conditions and
an article on fair labour standards. It was a counter-hegemonic charter.20

It is not unreasonable to suggest that a fairer, more equitable trade treaty, which had in
significant part been led by all parties of the world, including developing states, would have
avoided the North South conflict that was later to manifest itself in the demands for the New
International Economic Order. Although the Soviet Union never signed the Charter, they may
have had little choice should the US and the rest of the world have done so. Instead, GATT was
created, under which developing nations have felt excluded, and whose situation has not
improved under the World Trade Organisation (WTO). Unlike the ITO, the WTO made no
provision for labour rights, nor for the significant involvement of non-governmental
organisations.21

2. Part two: Why did these institutions go unrealised?

Part one has described the historical actors, ideas and processes behind the institutions, as well
as some elements that left them stalled. This section considers institutional non-realisation in
greater detail. Part two will also briefly ask if there are lessons for modern reform, innovation
or institutional creation. Given the severity of today’s challenges, particularly on climate change
and financial governance, this question is timely and vital.

The truth is that the institutions were never realised for a universe of different reasons. It is
possible, however, to identify some commonalities between each of the unrealised institutions.
This part describes three commonalities: ideas in relation to time, the danger of individual
overreach, and the context of realpolitik and the sovereign state.

2.1. The passing of the creative moment

The first commonality concerns the post-war ‘moment’. This is the idea that in the aftermath of
the ‘scourge of war’, greater political space for ideas was created. The war united the world, or
certainly the great powers, who, for a moment, partially relaxed their pursuit of national
interest to allow for the creation of the United Nations and other world institutions. The new
space gave room for leaders like President Roosevelt to rally their nations around institutions
that may have been otherwise difficult to justify. Likewise, Sir John Orr’s speech at Quebec may
not have been received so well in more normal times, indeed he may not have been appointed
director-general at all. But the moment was brief. As time passed, particularly after Roosevelt’s
death and the exit of New Dealers from the White House towards the end of the war, this

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idealism began to fade. Right began to lose to might, and he who paid the piper realised he could
call the tune.22

The opening and closing of political space is perhaps best demonstrated by the case of the
World Food Board. The idea had arisen during the war, promulgated by both Franklin Delano
and Eleanor Roosevelt, that food policy would change on a world-scale, that freedom from want
could be realised, that this, in part, was what the war was being fought for. But Boyd Orr
recognised that this was merely a moment. As he wrote later, the ‘promise of the Atlantic
Charter...the ‘fuller life, the true and great inheritance of the common man’ that Churchill
envisaged, ‘the relegation of poverty to the limbo of the past’ that Ernest Bevin, a member of
Churchill’s UK war cabinet foresaw... ‘would be quickly forgotten’’. He worked with urgency to
try to create the executive food agency, but for this institution, the moment had already passed:
‘the political atmosphere had changed’: the US and Britain were not willing to cede control to
the UN organisation. 23

Moments and spaces for institutional creation vary in space and time. Although the Bretton
Woods conferences were held in 1944 when war in Europe was still raging, albeit with a
predictable outcome, it was already clear that the United States would emerge as the unequalled
economic world power. Keynes, the advocate for the International Clearing Union, could do little
to appeal to the American sense of humanity: for them the union was just too expensive. Yet
something of the moment still existed in Havana in 1948, where the US negotiator Will Clayton
signed the Charter of the International Trade Organization. This was ‘a singular moment when
ideas, institutions and actors shared a common interest and...created a common ground where
none existed previously.’ That somehow the negotiators had, by the time of the signing of the
charter in Havana, amalgamated the values of free trade, full employment and development
must be understood as a remarkable alignment of ideals: a true post-war moment. Yet this
moment may have only existed in the bubble of negotiations in Havana: back in Clayton’s
capital, inflation, strikes, negotiations over both the Marshall Plan and the new North Atlantic
Treaty Organisation, meant that the will to expend political capital on the ITO had passed.24

2.2. Too brilliant, too exhausted

A second commonality looks to the individual actors involved and asks whether they
overreached their ability to change the world. Did they allow themselves to pursue their own
ideals too far beyond practicality – making the best the enemy of the good? Was there only so
much that the idealists in this non-story could achieve before they lost the support of the
bureaucrats they led? One example comes from Keynes’ experience at Bretton Woods. The
British press officer who accompanied him to the conference suggested that Keynes ‘was too
brilliant, too crushing and towards the end, too exhausted’ to properly fulfil his negotiation
duties for Britain. Although Keynes was a passionate advocate of his ideas and a superb orator,
he constantly struggled with health problems related to the stresses of his work. A standing
ovation and reverent treatment at the end of the Bretton Woods conference would not make up
for losing the battle of ideas.25

In Quebec, the hesitant method of Boyd Orr’s appointment might have been read as a desire for
a steady hand on the tiller until delegates could agree more closely on FAO’s mission. This was
not in Boyd Orr’s nature. He had announced to the Quebec conference that he wanted ‘no
millionaire to be able to buy an orange until all the children in the world have had food’. He had

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a task to fulfil and one he believed in passionately. But his passion may have aggravated the
FAO’s relationship with the US and Britain, who ensured that Boyd Orr would only lead the
organisation for a non-renewable two year term, rather than the normal four years. His
mentions of taking steps towards world government probably exacerbated this. Though his
ideals seemed far in advance of his peers, he himself did not regard this as a problem. He gave a
speech to the BBC in 1945, stating that ‘if a scheme which [opens new markets and brings about
a great expansion of trade], and at the same time banishes hunger and malnutrition from the
world and gets the nations to cooperate with each other instead of fighting each other – if this is
idealism, then I say this crazy world will be all the better for a good stiff dose of idealism.’26

Personal overreach does not only concern idealistic personalities. Boyd Orr’s preference for
grand, sweeping plans may have prevented him from taking a more strategic approach to
institutional development. To abuse a food metaphor: by placing all his eggs in the World Food
Board basket, he missed opportunities to work with other institutions. Both the International
Trade Organisation and the Bretton Woods institutions at times considered commodity price
stability in their evolution, but it does not appear that Boyd Orr put much effort, even allowing
for his limited time, into pursuing his food policy through these different routes.27

The case of the International Trade Organisation also demonstrates personal overreach. Given
the United States’ form regarding other institutions and its previous refusal to consider
possibilities of expropriation, it seems surprising that the US negotiator, Will Clayton, signed the
Charter. His actions had surprised the rest of his delegation too. Clayton’s deputy, Clair Wilcox,
was far less keen on making concessions to the extent that Clayton was, suggesting critically
that Clayton had ‘identified himself with the Charter’. Thus Clayton may have allowed himself to
become too distant from Washington, overreaching his capacity or authority to act. Though
there were intervening events between the signing and withdrawal of the Havana charter from
the Senate, his actions may have made Senate approval less likely.28

2.3. Return to realpolitik

If the creative moment had died, and individuals could not recreate it without overreaching,
then we might assume that realpolitik had returned to win the day. This is demonstrated by the
Bretton Woods institutions in particular, elements of the World Food Board, and in the slow
death of the International Trade Organisation. The stirrings of the cold war also had affected
these three institutions.

Several aspects of Keynes’ plans had upset Washington. Firstly, the sheer quantity of money
involved was unacceptable: the US would have the greatest liability in an institution that
required about $26bn to function. Secondly, perhaps more importantly, the Americans wanted
to shape international economic policy according to their own ideals. As Keynes would bluntly
write: ‘the Americans at the top seem to have absolutely no conception of international
cooperation; since they are the biggest partners they think they have the right to call the tune on
practically every point. If they knew the music this would not matter so very much; but
unfortunately they don’t.’ But Keynes’ own proposals were hardly unbiased. Though he claimed
that his ideas would promote the welfare of all, and he was not technically employed by the UK
Treasury for much of his time, his plans always seemed to ensure that the UK would get a good
deal. His view of the risks to the post-war UK economy led him to push the US negotiators
though he knew the decision was ultimately an American one.29

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The World Food Board suffered from similar national interest issues of power and funding. At
the first session of the committee that was commissioned to expand upon Boyd Orr’s proposals
for a World Food Board, the United States delegate Norris Dodd, who would become the next
Director-General, was suspicious of the ‘effect that widespread government intervention
threatens to have on the agricultural supply and demand situation all over the world once the
present emergency has come to an end’. He may have been right, but leftist media in the UK
reported his real intent as to block multilateral food distribution discussions, in order that the
US could work bilaterally. Again, the US was expected to be the largest funder of the board.
Dodd rejected this: ‘governments are not likely to place the large funds needed for financing
such a plan in the hands of an international agency over whose operations and price policy they
would have little or no control.’ Similarly, Boyd Orr believed that Britain worked to prevent the
board for fear that it would affect Britain’s cheap food imports. As another FAO Director-General
would put it much later: as ‘a man far ahead of his times, [Boyd Orr] had fatally
underestimated...the force of national sovereignty’. Food and agriculture have remained
sensitive political topics for national governments everywhere.30

The ITO is perhaps the best example of where the power of an individual nation would set the
multilateral agenda. If the US had ratified the Havana charter, the rest of the world would have
certainly followed suit. As the world’s biggest producer, trading partner and funding source, the
US had the absolute decision-making power over the institution. As discussed above, by the late
forties President Truman’s legislative agenda was busy: the enormously expensive Marshall
Plan may have given senators the feeling that the US should have conceded less at Havana.
Perhaps more importantly, US trade bodies had turned against the treaty. The two most
powerful business lobby groups in post-war America, the National Association of Manufacturers
and the Chamber of Commerce had previously supported the organisation, but given the turn of
the tide against Keynesian full employment ideals, they switched positions and would have
applied pressure on senators to reject the charter.31

Finally, the cold war increased the importance of realpolitik, as political games would take over
US decision making, and ideology divided the world order. The Soviets attended both the
Bretton Woods conferences and the first meeting of the IMF at Savannah, but never ratified the
articles: Harold James suggests that this act began the cold war. In relation to world food policy,
Boyd Orr actually tried to use the cold war as a lever, claiming in an article published in 1949,
that ‘unless help be given to the undeveloped countries...there is the danger that communism,
with its promises of...abundance for the masses, will continue to spread’. In reality, the Soviet
Union made it harder for Boyd Orr. Their refusal to take part in the board’s preparatory
commission, despite being present in the full FAO conferences, led to the absence of any
ideological leverage and more practically, a considerable grain producer. Both the US and Soviet
Union would later use food aid to promote their ideologies – something a multilateral executive
agency would have mitigated against. Nor did the Soviet Union attend any of the UN
Conferences on Trade and Employment which led to the Havana charter, although countries
under of its sphere of influence did.32

In sum, there are commonalities threaded through the history of each of these unrealised
institutions. The next section asks what we can learn from them.

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3. The intellectual remains

The three examples show that groups of impassioned idealists can be not only be heard, but
given positions of considerable power. They show that there are moments when realpolitik is
not the ultimate determiner of institutional creation. The negotiators that states send to
conferences are merely human, as are their heads of state. A powerful leader can support an
idea and draw on political capital to ensure its realisation. Yet the examples also show that these
moments are fleeting and that where institutional creation occurs, if power is shared unevenly,
biased bargains are likely to result.

Though these three institutions never existed, the ideas upon which they were proposed never
died. They exist, almost in an intellectual ether, awaiting either another moment in which they
find relevance, or another actor who will take up their charge. In a historical review of the FAO,
it was argued that ‘despite its failure, Boyd Orr’s World Food Board exercises a continuing
fascination. It proposes the ultimate vision of a world food policy based on universal equity,
formulated by technicians and centering on a body that has the authority to take decisions and
not only to circulate recommendations.’ Boyd Orr’s spirited attack on world hunger has
influenced a range of subsequent FAO directors-general (his bust greets visitors at the main
entrance of the FAO’s headquarters in Rome) and the entire poverty discourse. Likewise, as
Robert Skidelsky wrote in the moving final paragraphs to his three volume opus on Keynes:
‘ideas do not die so quickly; and Keynes’ will live so long as the world has need of them.’ In
2009, the governor of China’s central bank called for something similar to Keynes’ Bancor as a
reaction to the ongoing trade imbalances that were a cause of the financial crisis.33

Today, the balance of power in the world is shifting. Arguably, economic power has already
moved Eastwards, and political and military power is likely to follow. There will come a point at
which it is not clear to whom hegemonic power belongs; a point where global power appears to
exist at several centres. This point may enable space for ideas newly proposed or already
existing to find themselves in another creative ‘moment’ – it is what this essay teaches us about
how to prepare or deal with this moment with which it concludes.

4. Concluding thoughts

This essay described three unrealised institutions in terms of ideas, reality and what might have
been. It sought to identify commonalities in their non-existence, finding three elements: the
short-lived nature of the creative ‘moment’ driven by the impact of war, the limits of individual
ability, and ultimately, the great power of realpolitik and self-interest.

This discussion has by no means provided a full picture. A great deal of further research could
be done into these institutions. What other effects might their creation have had? Can the goals
of these institutions be realised in our current patchwork of governance, or have we found other
routes towards realising them? The essay demands an answer to the impossible question of
counterfactual history: should we take a deterministic world-view that our path always leads to
the same state, or would the smallest change have altered our world story? Further, this essay is
entirely Anglo-centric, failing to account for the actors, ideas and experiences of Russian, French
or colonised peoples in relation to these institutions; another possibility for further research.

11


It is hoped that, despite these shortcomings, the essay is still significant. It is nearly seventy
years since these ideas were proposed; the seventy year ‘non-anniversary’ that nobody will
celebrate. Yet perhaps we should commemorate these unrealised institutions. What a loss if
they could not teach us something about how to deal with the great global challenges faced by
humanity today; about how to reform our contemporary institutions, which fail to deal
efficiently or equitably with climate change, financial crises and preventable poverty and
disease. As the economic power of the United States wanes, it is possible to imagine that the
conditions for a new creative moment are on the horizon. The lessons from history suggest that
the way to meet it is to build truly global coalitions; to limit or push back against hegemonic
power; to prevent stronger parties from cherry-picking in negotiations; and to avoid over-
reliance on great individuals, but to support them to dream, to inspire, and to create.

12


Bibliography

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December 2011.
Havana Charter For An International Trade Organization, 1948, available at
www.worldtradelaw.net/misc/havana.pdf, accessed 4 December 2011.
Books / book chapters

Blokker, N., International Regulation of World Trade in Textiles, Dordrecht: Martinus Nijhoff
Publishers, 1989.
Boyd Orr, J., and Lubbock, D., The White Man’s Dilemma, 2nd ed., London: George Allen and Unwin,
1964.
van den Bossche, P., The Law and Policy of the World Trade Organization, Cambridge: Cambridge
University Press, 2005.
van Brabant, J., The Planned Economies and International Economic Organizations, Cambridge:
Cambridge University Press, 1991.
Buterbaugh, K., and Fulton, R., The WTO Primer, New York: Palgrave, 2008.
Casey, K.M., Saving international capitalism during the early Truman presidency, New York:
Routledge, 2001.
Dervis, K. and Ozer, C., A Better Globalization: Legitimacy, Governance, and Reform, Washington:
Center for Global Development: 2005.
Odell, J., and Eichengreen, B., ‘The United States, the ITO and the WTO: Exit Options, Agent Slack
and Presidential Leadership’, in The World Trade Organisation as an International
Organisation, edited by Anne Krueger, Chicago: University of Chicago Press, 1998.
Phillips, R.W., FAO: its origins, formation and evolution 1945–1981, Rome: FAO, 1981.
Roessler, F., ‘Domestic Policy Objectives and the Multilateral Trade Order: Lessons from the Past’ in
The World Trade Organisation as an International Organisation, edited by Anne Krueger,
Chicago: University of Chicago Press, 1998.
Schlesinger, S., Act of Creation: The Founding of the United Nations, Cambridge: Westview, 2003.
Skidelsky, R., John Maynard Keynes, Vol. 3: Fighting for Freedom, 1937-1946, New York: Penguin,
2001.
Shaw, D.J., World Food Security: A History Since 1945, London: Palgrave, 2005.
Talbot, R., The four world food agencies in Rome, Ames: Iowa State University Press, 1990.
Toye, R., and Toye, G., The UN and Global Political Economy, Indiana: Indiana University Press,
2004.
Journal articles / working papers / newspaper articles

Boerma, A.H., ‘Sir John Boyd Orr Inaugural Memorial Lecture’, Proceedings of the Nutrition Society,
Vol. 34 (1975), 145-157.
Boughton, J., ‘Why White, not Keynes? Inventing the Postwar International Monetary System’, IMF
Working Paper, IMF Policy Development and Review Department, (WP/02/52: 2002).
Buttonwood, ‘Voters vs. Creditors’, The Economist, 19 November 2011.
Boyd Orr, J., ‘Enough food for everyone?’, The Rotarian, July, 1949.
Crawford, J.G., ‘Proposals for a World Food Board’, The Australian Quarterly, 18:4, (Dec., 1946), 5-
18.

13


Drache, D., The Short but Significant Life of the International Trade Organization: Lessons for Our
Time, CSGR Working Paper No. 62/00, University of Warwick, November 2000.
Jacertz, R., and Nutzenadel, A., ‘Coping with hunger? Visions of a global food system, 1930–1960’,
Journal of Global History, 6:1, (2011), 99-119.
Newton, S., ‘A ‘visionary hope’ frustrated: J.M. Keynes and the origins of the postwar international
monetary order’, Diplomacy & Statecraft, 11:1, (2000), pp. 196-200.
Unaccredited, ‘Beyond Bretton Woods 2’, The Economist, November 4, 2010
Unaccredited, ‘Set Back to World Food Board’, Tribune Magazine, 1 November 1946.
Organisational documents

Oxfam International, Food aid or hidden dumping? Separating wheat from chaff, 2005.
World Health Organisation, Task Force On Innovative International Financing For Health Systems
Receives Two Working Group Reports, Press Release, 13 March 2009.
Food and Agriculture Organisation, Report of the Conference of FAO, Second Session, Copenhagen,
Denmark, 2-13 September 1946, Chapter XII: Report of Commission C to the Conference.
Available online at http://www.fao.org/docrep/x5583E/x5583e0e.htm, accessed 4
December 2011.
Food and Agriculture Organisation, Report of the Conference of FAO Special Session, Rome, 16
November 1970, Chapter X. Annex D - Commemorative address by professor M. Cépède,
Independent Chairman of the FAO Council. Available online at
http://www.fao.org/docrep/x5591E/x5591e0a.htm, accessed 4 December 2011.
Broadcasts / speeches

Boyd Orr, J., Broadcast over BBC, November 5, 1945, transcript at
http://www.fao.org/about/27903-07465fc702d46be5bacb9fcfc9517071b.pdf, accessed 4
December 2011.
Boyd Orr, J., Nobel Lecture, 12 December 1949, transcript at
http://www.nobelprize.org/nobel_prizes/peace/laureates/1949/orr-lecture.html accessed
4 December 2011.
Shaw, D.J., ‘World Food Security: A History Since 1945: a book launch and discussion, London:
Overseas Development Institute, 16 October 2007, transcript at
http://www.odi.org.uk/events/details.asp?id=220&title=world-food-security-history-since-
1945-book-launch-discussion accessed 4 December 2011.

1 Hansard, HL Deb 18 May 1943 vol 127 cc521-64. Accessed at
http://hansard.millbanksystems.com/lords/1943/may/18/international-clearing-union on 26
November 2011.
2 Robert Skidelsky, John Maynard Keynes, Vol. 3: Fighting for Freedom, 1937-1946, (New York: Penguin,

2001) (hereafter ‘Skidelsky’), pp. 202-225; Scott Newton (2000): A ‘visionary hope’ frustrated: J.M.
Keynes and the origins of the postwar international monetary order, Diplomacy & Statecraft, 11:1,
(hereafter ‘Newton’) pp. 196-200.
3 Atlantic Charter 1941, clause 8. In no legal sense was the document actually a charter.
4 Skidelsky, op. cit., pp. 462-468; Newton, op. cit., p.202.
5 James Boughton, ‘Why White, not Keynes? Inventing the Postwar International Monetary System’, IMF

Working Paper, IMF Policy Development and Review Department, (WP/02/52: 2002), p. 16.
6 Skidelsky, op. cit., pp. 349.

14


7‘A pathetic procession of stooges’ was the phrase Keynes used. He wrote that ‘he had come to Savannah
expecting to meet the world, and all I met was a tyrant’. Newton, op. cit., pp. 202-203. For more on the
importance of location, see Kemal Dervis and Ceren Ozer., A Better Globalization: Legitimacy, Governance,
and Reform, (Washington, Center for Global Development: 2005) p. 84.
8 On the US-China currency dispute, see, e.g., Arthur Kroeber, ‘The Renminbi: The Political Economy of a

Currency’, Working Paper No. 3, Shaping the Global Order, Brookings Institution, Sept. 7, 2011. The
Eurozone crisis represents a similar problem: see Buttonwood, ‘Voters vs. Creditors’, The Economist, 19
November 2011.
9 Addeke Boerma, ‘Sir John Boyd Orr Inaugural Memorial Lecture’, Proceedings of the Nutrition Society

(1975), Vol. 34, (hereafter ‘Boerma’), p. 146; Ralph W. Phillips, FAO: its origins, formation and evolution
1945–1981 (Rome: FAO, 1981), available online at
http://www.fao.org/docrep/009/p4228e/P4228E02.htm accessed 26 November 2011.
10 J. G. Crawford, ‘Proposals for a World Food Board’, The Australian Quarterly, Vol. 18, No. 4 (Dec., 1946),

(hereafter ‘Crawford’) p. 12.
11 John Boyd Orr and David Lubbock, The White Man’s Dilemma, 2nd ed. (London: George Allen and Unwin,

1964), hereafter ‘Boyd Orr and Lubbock’. For more on the world food situation in the post-war years, see,
e.g. Food and Agriculture Organisation, Report of the Conference of FAO, Second Session, Copenhagen,
Denmark, 2-13 September 1946, Chapter XII: Report of Commission C to the Conference. Available online
at http://www.fao.org/docrep/x5583E/x5583e0e.htm (accessed 4 December 2011).
12 Crawford, op. cit., p.16.
13 Boyd Orr and Lubbock, op. cit., pp. 59 – 71; D. John Shaw, World Food Security: A History Since 1945,

(London: Palgrave, 2005), hereafter ‘Shaw’, pp. 27-30; Ruth Jacertz and Alexander Nutzenadel, Coping
with hunger? Visions of a global food system, 1930–1960, Journal of Global History (2011) 6, (hereafter
Jacertz and Nutzenadel) p. 110.
14 World Health Organisation, Task Force On Innovative International Financing For Health Systems

Receives Two Working Group Reports, Press Release, 13 March 2009, accessed at
http://www.who.int/pmnch/media/membernews/2009/20090313_hltfmeeting/en/index.html on
November 27, 2011; Oxfam International, Food aid or hidden dumping? Separating wheat from chaff, 2005.
Available at www.oxfam.org/files/bp71_food_aid.pdf accessed 4 December 2011.
15 Richard Toye and Geoffrey Toye, The UN and Global Political Economy, (Indiana: Indiana University

Press, 2004), (hereafter Toye and Toye) p. 24. Cordell Hull won the Nobel Peace Prize four years before
Sir John Boyd Orr.
16 Frieder Roessler, ‘Domestic Policy Objectives and the Multilateral Trade Order: Lessons from the Past’

in The World Trade Organisation as an International Organisation, edited by Anne Krueger (Chicago:
University of Chicago Press, 1998).
17 John Odell and Barry Eichengreen, ‘The United States, the ITO and the WTO: Exit Options, Agent Slack

and Presidential Leadership’, in The World Trade Organisation as an International Organisation, edited by
Anne Krueger (Chicago: University of Chicago Press, 1998) pp. 185-186. Hereafter, ‘Odell and
Eichengreen’.
18 Peter Van den Bossche, The Law and Policy of the World Trade Organization, (Cambridge: Cambridge

University Press, 2005), pp. 79.
19 Daniel Drache, The Short but Significant Life of the International Trade Organization: Lessons for Our

Time, CSGR Working Paper No. 62/00, November 2000. Hereafter, ‘Drache’.
20 Havana Charter For An International Trade Organization, available at

www.wto.org/english/docs_e/legal_e/havana_e.pdf, accessed 4 December 2011.
21 Drache, op. cit., p. 25.
22 This is to paraphrase Keynes’ complaint about the American delegation at Bretton-Woods: Newton, op.

cit., p. 202.
23 Shaw, op. cit., p. 27.
24 Drache, op. cit., p. 5.
25 Skidelsky, op. cit., p. 449. Jason Tomes, “Bareau, Paul Louis Jean (1901–2000),” in Oxford Dictionary of

National Biography, online ed., ed. Lawrence Goldman, available at
http://www.oxforddnb.com.proxy.lib.uwaterloo.ca/view/article/73848, accessed November 25, 2011.
26 FAO, Report of the Conference of FAO Special Session, Rome, 16 November 1970, Chapter X. Annex D -

Commemorative address by professor M. Cépède, Independent Chairman of the FAO Council at
http://www.fao.org/docrep/x5591E/x5591e0a.htm accessed 4 December 2011; John Boyd Orr,
Broadcast over BBC, November 5, 1945, transcript at http://www.fao.org/about/27903-

15


07465fc702d46be5bacb9fcfc9517071b.pdf, accessed 4 December 2011. The full speech is typical of his
remarkable oratorical ability.
27 See evidence from, e.g., Shaw, op. cit., p. 29.
28 Odell and Eichengreen, op. cit., p. 186.
29 Newton, op. cit., pp. 202-204. Skidelksy’s third volume on John Maynard Keynes was published in the

UK as ‘Keynes: Fighting for Britain’, but the name was changed to ‘Keynes: Fighting for Freedom’ for the
North American edition. Keynes’ vast personal wealth was amassed from sales of his books, and his
trading of shares on the London Stock Exchange. As Skidelsky’s work illustrates, he was not only a
political economist, but an intellectual in many areas, a patron of the arts and a celebrity who moved in
the top elite circles in London.
30 Boerma, op. cit., p. 151; ‘Set Back to World Food Board’, Tribune Magazine, 1 November 1946, accessed

http://archive.tribunemagazine.co.uk/article/1st-november-1946-new/4/set-back-to-world-food-
board-on-two-issues-this, accessed 4 December 2011; Jacertz, op. cit., p. 111 ; Shaw, op. cit., p. 27. For the
ongoing political sensitivity of agricultural policy consider, e.g., the longevity of European Common
Agricultural Policy, developed partly to ensure food security in Europe, and even when grossly
overproducing to the point that security could no longer be considered a rational argument, it was still
considered untouchable by politicians, particularly in France. Or, similarly, the ‘big corn’ lobby in the
United States.
31 Kevin Buterbaugh and Richard Fulton, The WTO Primer, (New York: Palgrave, 2008), p. 21; Odell and

Eichengreen, op. cit., pp. 186, 189
32 Skidelsky, op. cit., p. 451; John Boyd Orr, ‘Enough food for everyone?’, The Rotarian, July, 1949, p. 16;

Jacertz and Nutzenadel, op. cit., p. 110; Joseph van Brabant, The planned economies and international
economic organizations, (Cambridge: Cambridge University Press, 1991), p.43; Niels Blokker,
International Regulation of World Trade in Textiles, (Dordrecht: Martinus Nijhoff Publishers, 1989), p. 50.
33 Ross Talbot, The four world food agencies in Rome, (Ames: Iowa State University Press, 1990), p. 19;

Skidelsky, op. cit., p. 508; ‘Beyond Bretton Woods 2’, The Economist, November 4, 2010 at
http://www.economist.com/node/17414511 accessed 4 December 2011.

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