Kairos logo Kairos Hearing 1994.


The year 1994 marked the 50th anniversary of the Bretton Woods Conference. In all parts of the world social movements, trade unions, churches and other parts of civil society and even the UN in its Human Development Report 1994 have used this occasion to point to the catastrophic effects of the present world economic and financial system on people and nature. Bretton Woods designed the order and institutions which though with some changes in their functions over the years are being charged with responsibility for the social divisions and ecological destruction in many parts of the world: the International Monetary Fund (IMF), the World Bank and the General Agreement on Tariffs and Trade (GATT), now the World Trade Organisation (WTO).
But are they the ones primarily responsible? Was the system not decided by governments? And are not representatives of governments (and central banks for which governments are at least partly responsible) the prime actors in keeping the structure and policies of those institutions in their present form? More precisely: given the undemocratic structures of these institutions it is mainly the governments of the rich industrialised countries (particularly the so-called Group of Seven/G7) who are responsible. Germany, Britain, France and Italy are at the same time members of the European Union and the G7.
A new situation is arising through the implementation of the economic and monetary union in the EU. It is true that the EU is not yet formally responsible for the international monetary and financial order which characterises the core of the problem. But it will be in the near future. Now is the time in which there should be an intensive discussion in Europe on how the world economic system can be changed. It has been dominated by the USA since World War II but now Europe and Japan are co-players, at the same time strong and responsible. The issue is how this system can be regulated according to socially and ecologically sustainable criteria. Europe can and must lead the way towards an alternative. A precondition for this is to create a political will.
The political will can only be created if we, the forces of civil society, form broad alliances and convince the public that these issues are questions of survival. Kairos Europa tries to give the victims of the present developments the chance to be actors again, to raise their voices and build coalitions with forces of solidarity in society. The global system is making new social and political actors out of the victims, not only in the South and East but more and more in Western Europe.
This is the reason why Kairos Europa formed four international teams of concerned people and experts from all regions to prepare the hearing documented in this paper. They researched the effects of the Bretton Woods system and possible alternatives in the Caribbean, in Brazil, Germany/Poland and Switzerland/Italy. They were the witnesses and experts in the hearing and they also prepared the "Questions and Proposals" which were presented to the representatives of the European institutions.
This is also the reason why Kairos Europa not only raised the issue of third world debt and the disadvantages of the South (and the East) created by the policies of the IMF, World Bank and GATT, but also drew parallels between the processes of impoverishment there and in the rich Western Europe. Accordingly it called for global reforms.
The result: We need a new Bretton Woods for a new global economic order. There are good proposals, for example presented by UNDP, by the European Parliament, by the FAST Programme of the EU.
We observe that neither at EU level nor in the member states, is there enough consciousness for the co-responsibility of Europe in the renewal of the world economic system. This is why we did not challenge the institutions of the Bretton Woods system itself, but those politically responsible in the institutions of the EU and its member states.
We thank the representatives of the Parliament and Commission for accepting our invitation to participate in that hearing and participating in what was, at times, a heated discussion. Especially we thank the Socialist and Green Faction in the European Parliament for their organisational assistance and for giving us rooms and interpreters free of charge. Sabine Meyer, in particular, was very helpful in preparing the hearing.
We regret that it was not possible to have members of the Council of Ministers, who have the decisive power in the EU, participating in the hearing. This is why we have sent our "Questions and Proposals" in writing to the President of the Council and finance ministers of the EU and also to the presidents of the central banks in the EU member states. We will also publish their answers in order to create a public discussion about these central questions in all nations of the EU. No longer should financial matters be declared expert matters, excluding the public from a democratic discussion, because there is no power-factor in the present world which determines the wellbeing of every single person and the whole earth as much as the money economy and the financial system.
We rejoice in the fact that this hearing and also the letter to the EU Council and the presidents of the coalition: the World Council of Churches, the central banks have been supported by a broad European Ecumenical Organisation for Development, the European Ecumenical Commission for Church and Society, regional church councils, information and documentation centres within and outside Europe, NGOs like the Bretton Woods Reform Organisation, and the many grassroot organisations in cooperation with trade unions in the framework of Kairos Europa.
This documentation is not the end, but only the beginning of intensive efforts to make the EU take up its political responsibility for the renewal of the international financial order in respect of sustainable development, employment and social justice.

Heidelberg, December 1994

Ulrich Duchrow and Martin Gück

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