General de Gaulle against the US Federal Reserve

2024 Author: Seth Attwood | [email protected]. Last modified: 2023-12-16 15:55

When people talk about the collapse of the Bretton Woods system of international monetary settlements, they always remember the President of France, General de Gaulle. It is he who is believed to have dealt the most devastating blow to this system.

This system of currency regulation was created on the basis of an agreement signed by representatives of 44 countries at the UN monetary and financial conference, held in 1944 in the American Bretton Woods, New Hampshire. The Soviet Union did not take part in the conference and did not enter the International Monetary Fund, which was then created, that's why our ruble did not belong to the number of convertible currencies. The USSR had to literally pay for everything in gold. Including - for military supplies under Lend-Lease, carried out on credit.

And the United States has made a lot of money out of the war. If in 1938 Washington's gold reserves were 13,000 tons, in 1945 17,700 tons, then in 1949 it increased to a record high of 21,800 tons, accounting for 70 percent of all world gold reserves.

The countries participating in the BVS conference approved currency parities "in gold as a common denominator" - but not directly, but indirectly, through the gold-dollar standard. This meant that the dollar was practically equated with gold, it became the world monetary unit, with the help of which, through conversion, all international payments were made. At the same time, none of the world currencies, apart from the dollar, had the ability to "turn" into gold. The official price was also set: $ 35 per troy ounce, or $ 1.1 per gram of pure metal. Even then, many doubted whether the United States was capable of maintaining such parity, because the US gold reserves in Fort Knox, even with their record volumes, were no longer enough to provide gold production to the American Treasury's money machine, which was operating at full capacity. Almost immediately after Bretton Woods, the United States began in every possible way to limit the possibilities of exchanging dollars for gold: it could be carried out only at the official level and only in one place - the US Treasury. And, nevertheless, despite all the tricks of Washington, from 1949 to 1970, the US gold reserves fell from 21,800 to 9,838, 2 tons - more than half.

The first to revolt against the BVS and the dollar was the Soviet Union. On March 1, 1950, a decree of the USSR Council of Ministers was published in our newspapers: the government recognized the need to raise the official ruble exchange rate.

And its calculation should not be based on the dollar, as it was established in July 1937, but on a more stable gold basis, in accordance with the gold content of the ruble at 0.222168 grams of pure gold. The purchase price of the State Bank for gold was set at 4 rubles 45 kopecks per gram. And for the American dollar in the USSR, they officially gave only 4 rubles instead of the previous 5 rubles 30 kopecks. I. V. Thus, Stalin was the first to try to undermine the gold standard of the dollar - and this seriously alerted Wall Street. But the real panic there was caused by the news that in April 1952 an international economic conference was held in Moscow, at which the USSR, the countries of Eastern Europe and China proposed to create a trade zone, alternative to the dollar. Iran, Ethiopia, Argentina, Mexico, Uruguay, Austria, Sweden, Finland, Ireland and Iceland have shown interest in the plan. At the meeting, Stalin for the first time proposed the creation of a transcontinental "common market", where its own interstate settlement currency would operate. The resounding Soviet ruble had every chance of becoming such a currency, the determination of the exchange rate of which was transferred to a gold basis. Stalin's death did not allow the idea to be brought to its logical conclusion; it took more than 50 years for it to reappear in the form of President Dmitry Medvedev's proposal to introduce international settlements in national currencies, and not just in dollars.

But the "Stalin case" was continued by Charles de Gaulle, who was elected president of France in 1958 and re-elected in 1965 with the broadest powers that the country's presidents did not have before. De Gaulle set the task of ensuring the economic growth and military power of France and, on this basis, to recreate the greatness of his state. Under him, a new franc was issued in denominations of 100 old ones. The franc has become a hard currency for the first time in years. Having abandoned liberalism in the country's economy, De Gaulle achieved a rapid growth in the country's gross domestic product by 1960.

From 1949 to 1965, France's gold reserves increased from 500 kilograms to 4,200 tons, and France took the third place in the world among the "golden powers" - excluding the USSR, information about the gold reserves of which was classified until 1991. In 1960, France successfully tested an atomic bomb in the Pacific Ocean and three years later withdrew from NATO's joint nuclear forces. In January 1963, de Gaulle rejected the "multilateral nuclear forces" created by the Pentagon, and then removed the Atlantic fleet of France from NATO command.

However, the Americans had no idea that these were only flowers. The most serious conflict in post-war history between de Gaulle and the United States and Britain was brewing. Neither Franklin Delano Roosevelt nor Winston Churchill disliked de Gaulle, to put it mildly.

Roosevelt's dislike for the "arrogant Frenchman," whom he called a "hidden fascist" and "a foolish person who imagines himself the savior of France," was fully shared by Churchill.

Complaining that "the unbearable rudeness and impudence in this man's behavior are complemented by active Anglophobia," Churchill, as evidenced by recently published archival documents, actively tried to remove de Gaulle from the political life of France.

But the hour of Parisian revenge has come. De Gaulle opposed the admission of England to the Common Market. And on February 4, 1960, he announced that his country would henceforth switch to real gold in international settlements. De Gaulle's attitude to the dollar as a "green wrapper" was formed under the impression of an anecdote told to him long ago by the Minister of Finance in the Clemenceau government. Its meaning is as follows. A painting by Raphael is on sale at the auction. The Arab offers oil, the Russian offers gold, the American lays out a bundle of banknotes and buys Raphael for ten thousand dollars. As a result, he gets a canvas for exactly three dollars, because the cost of paper for a hundred dollar bill is three cents. Realizing what the "trick" was, de Gaulle began to prepare the de-dollarization of France, which he called his "economic Austerlitz." On February 4, 1965, the President of France declares that he considers it necessary for international exchange to be established on the indisputable basis of the gold standard. And he explains his position: “Gold does not change its nature: it can be in bars, bars, coins; it has no nationality, it has long been accepted by the whole world as an invariable value. There is no doubt that even today the value of any currency is determined on the basis of direct or indirect, real or perceived ties with gold. " Then de Gaulle demanded from the United States - according to the BVS - "living gold". In 1965, at a meeting with US President Lyndon Johnson, he announced that he intended to exchange 1.5 billion paper dollars for gold at the official rate: $ 35 per ounce. Johnson was informed that a French ship loaded with "green candy wrappers" was in the New York port, and a French plane with the same "baggage" had landed at the airport. Johnson promised the French president serious problems. De Gaulle responded by announcing the evacuation of NATO headquarters, 29 NATO and US military bases, and the withdrawal of 35,000 alliance troops from France. In the end, this was done, but, while the essence and the matter, de Gaulle in two years significantly lightened the famous Fort Knox: by more than 3 thousand tons of gold.

The President of France created a precedent that is most dangerous for the United States, other countries also decided to exchange their "green" for gold, following France, Germany presented dollars for exchange.

Ultimately, Washington was forced to admit that it could not meet the requirements of the BVS. On August 15, 1971, US President Richard Nixon, in his televised speech, announced that henceforth the gold backing of the dollar was canceled. At the same time, "green" was devalued.

Shortly thereafter, there was a crisis of the system of fixed rates, new principles of currency regulation were agreed in 1976, the dollar remained the key currency in international settlements. But it was decided to switch to a system of floating rates of national currencies, to move away from gold parity, while retaining the role of a foreign exchange reserve for the metal. The IMF also canceled the official gold price.

After his "currency Austerlitz" de Gaulle did not last long in power. In 1968, massive student riots swept over France, Paris was blocked by barricades, and posters hung on the walls "13.05.58 - 13.05.68, time to leave, Charles." On April 28, 1969, ahead of schedule, de Gaulle voluntarily left his post.