Evening star. [volume] (Washington, D.C.) 1854-1972, 1956-09-30

lion a year profits they expected the
Fund to earn. Instead, the Fund
is going in the red for about
81 million a year"
Another European financier who
was a Breton Woods delegate ex-
pressed skepticism. EITHER 1t (the
fund.- was destined to be denuded
OF its dollars or remain useless. It
Is useful as a meeting place, but as
such is extremely costly. Had 1t
been set up to act as a clearing
house for international exchange it
could have been useful but to
merely supplement what banks
normally do serves no purpose. The
fund actually created currency in
stability about 1850 when it put
pressure on Switzerland, a nom
member. not to sell gold at a small
premium. This policy drove gold
into the black markets"
Gone to Pieces
Still another European expert
familiar with the workings of the
fund declared that the Breton
Woods Fund Agreement has gone
to pieces" Whereas the pillar" Of
the agreement was to be fixed ex-
change rates, he said, what do we
have? Canada. since 1850, Peru
and Thailand have fluctuating
currencies. Numerous members
have fiuctuating multiple rates to-
day. Some have no par values,
like France. Ever since 1916 q dis
pute has been running in the fund
concerning use Of its resources by
members. sIhe Breton Woods
Agreement was accepted by many
countries in the belief that access
to those resources would be unob-
structed. But knowing that the
United States Congress accepted
the fund with some fears that it
would be wasted. the authorities
controlling the fund allow it to
make only short and medium-term
loans"
"And who are those authori-
ties?" he continued. "They are in
the last analysis the United States.
The Breton Woods Conference UNI
derstood that there would be three
great powers in the fund: The
United States, Russia and Britain.
When Russia reneged on joining,
the result was greatly to increase
the power of the United States,
which controls % per cent of the
votes plus the 6 per cent welded
by Formosa. Had we foreseen this
we'd never have accepted member
ship. AS it is, important clauses
of the agreement are not being
respected"
A former United States financial
official put it this way: I'VE could
have done a better Job ourselves,
making sterilization loans and set
ting conditions. The fund is in
effective. Twelve years after Bret
ton Woods only 10 countries, in.
Guiding us, have convertible money
today"
StobiIity Still For Off
That the fund and world affairs
have not developed as anticipated
at Breton Woods is clear enough.
The currency world, although i'm
proved. still is not stabilized. In
the past IL months alone, accord
ing to Picks World Currency Re.
port. 81 different currency units
have deprecated anywhere from
to 70 per cent.
In the currency progress achieved
to date the United States has put
not only its 81. $50. 000, 900 fund sub
Scription. but some $54 billions of
gifts and loans which have added
to the worlds supply of dollars.
Thus. while official pronounce
ments Of the fund and its members
paint a pleasant picture Of its
achievements and utility, off-the.
record talks reveal surprisingly
widespread dissatisfaction.
But there is no likelihood that the
fund will give the mony back"
any time soon. At Nineteenth and
H streets NV, it is building mod
ern new headquarters.