![]() Thus, it is argued, the French Government resented an international monetary regime which allowed the United States to expand its influence in Europe with more military bases and increased control by American investors of French industry. ![]() The conventional view attributes French complaints strictly to nationalistic political considerations, based on the observation that the United States had a deficit in its capital account and American companies were making massive investments in Western Europe. The size and persistence of American balance of payment deficits were of particular concern to France during the 1960s. This position enabled the United States to finance ongoing balance of payment deficits without having to make the adjustments required of other deficit countries. Under the gold-dollar standard-the legacy of the Bretton Woods international monetary conference of 1944-the United States benefitted from the extraordinary position of being the provider of a currency which was held as official reserves convertible into gold by central banks. This widely held view draws support from the obvious fact that French policy was a challenge to the economic and political dominance of the United States in Western Europe. The French had long made plain their sensitivity to perceived encroachments on their autonomy and a strong antipathy to what they felt was the economic domination of Europe by the United States.” ( Volcker and Gyohten, 1992, p. This interpretation of France’s international monetary actions during the 1960-1968 period posits French policy as pursuing President de Gaulle’s “anti-American” political goals rather than any sound economic objectives: “…a strong challenge to Bretton Woods and through Bretton Woods to the United States had already been launched by President de Gaulle of France. ![]() gold reserves weakened confidence in the dollar and ultimately precipitated the collapse of the system. According to this established view, the French began a policy of deliberately converting their dollar holdings into gold in 1965. The commonly held belief in the United States is that France played a crucial role in the breakdown of the Bretton Woods international monetary system which ended in August 1971. ![]()
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