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Last August, Germany’s social-democratic foreign minister, Heiko Maas, took to the pages of the German business daily Handelsblatt to respond to the most recent spate of inflammatory tweets from the White House by calling for a more “balanced partnership” between the United States and the European Union. The concrete issue behind Maas’s commentary was the American withdrawal in May from the multilateral nuclear deal, which will soon compel all American allies to either cut ties with Iranian banks or face possible sanctions and countermeasures themselves. But the article’s most eye-catching suggestion was for the creation of a new global payments system that could rival the Society for Worldwide Interbank Financial Telecommunication, or SWIFT—the world’s dominant international bank transfer network. Ad Policy

SWIFT’s infrastructure lurks behind almost all of the world’s cross-border transactions, but it functions more like the WhatsApp of global finance. Banks do not transfer funds or settle accounts via SWIFT; instead, they communicate their payment orders through SWIFT’s secure data channels and then reflect the payment requests via separate correspondent accounts they maintain with one another. Money crisscrosses the globe, but only in accounting terms.

Popular culture on both sides of the Atlantic conventionally portrays SWIFT as a long arm of the American security state. Tellingly, when Amazon recently revived Tom Clancy’s Jack Ryan for an age of anti-terrorism and binge watching, Ryan had left Wall Street for the CIA in order to monitor SWIFT transactions in the Middle East.

But far from being run by operatives in Langley, the Society for Worldwide Interbank Financial Telecommunication is a cooperative society under Belgian law located on the edges of a lush park on the Southern outskirts of Brussels. Founded in 1973 at the urging of a pair of Dutch and French bankers, SWIFT sought to develop common standards for financial transactions for a new age of floating exchange rates and the free global movement of capital after the collapse of the Bretton Woods system. When the network went live in 1977, SWIFT processed around 10 million transactions (“messages”) from mostly European and American banks. By 1989, the number of messages had exploded to almost 300 million, and today, its system fires off more than 5 billion messages around the globe every year.

SWIFT was in the first instance a construct of European banking, only grudgingly adopted by American banks that had initially sought to impose their own proprietary standards. Outsize American influence over the network is a very recent phenomenon. In fact, when the intergovernmental Financial Action Task Force on Money Laundering first approached SWIFT in the early 1990s with a request for information, SWIFT’s CEO Lenny Schrank shrugged it off confidently: “We don’t do subpoenas.”

It was only after September 11 that the organization, suddenly facing subpoenas from the United States itself, caved. The new rationale of anti-terrorism paved the way for unprecedented American access to SWIFT data, and a memorandum of understanding between the Belgian society and the Americans gave the US Treasury Department the ability to track financial flows in real time far beyond its borders.

When the secret agreement was revealed in a New York Times story in 2006, the Belgian Data Privacy Commission immediately began to investigate and found SWIFT in violation of both European and Belgian data-protection laws. That put SWIFT in a bind. When faced with the twin threat of US subpoenas and a violation of EU privacy law, it chose to abide by the American subpoenas, triggering a complex set of negotiations between the United States, the European Commission, and the Council of the European Union that ultimately changed very little. Current Issue View our current issue

Today, SWIFT is a private cooperative in name only; it can no longer pretend to avoid the global geopolitical hierarchies of our time. Thanks to its intelligence might, the American state can monitor virtually all cross-border bank transfers through SWIFT. What’s more, it can punish foreign banks for noncompliance by simply threatening to cut them off from dollar funding through the Federal Reserve—which, now more than ever, constitutes the basis of the global banking system.

Given how integral SWIFT is to global finance, it is understandable why Europeans plead for a world in which the United States is no longer able to sanction financial transactions outside its borders. It is also reasonable to wonder whether the Iran episode might hasten the demise of the dollar’s global hegemony. But to focus on SWIFT would mistake the proverbial tail for the dog.

European proposals for a SWIFT competitor are likely insufficient for altering the geopolitical landscape or for reviving the fortunes of progressive internationalism. A new SWIFT will not curb US power over global financial markets; nor will it lead European banks to remove themselves from the essential lifeline of dollar funding. In any future standoff over subpoenas, there is no reason to believe that the balance of power has favorably tilted toward the Europeans. Not even the Chinese would dare to extricate themselves from the global dollar system. The pivotal role of dollar, not the message system, is the problem.

Nor is an alternative SWIFT necessary to save the bare bones of the Iranian nuclear deal. As the EU itself seems to have recognized, in order to enable Iran to sell some of its oil and allow European producers to continue trading with Iran, all that is needed is a special-purpose vehicle that would settle Iranian oil against foreign goods without the use of direct financial transactions. It remains to be seen whether the European Union will ultimately be willing to bear the ire of the United States were it to keep on trading with the Islamic Republic.

There is, however, one more reason to keep SWIFT around. It might come as a surprise, but today’s diffuse global flows of capital turn out to operate through a single node—and it’s precisely thanks to its extraordinarily centralized nature that SWIFT contains an untapped, utopian promise. The mere existence of a single system, in particular one whose private pretense of neutrality has long been pierced by its tainted association with the American war on terror, keeps alive at least the theoretical possibility of global monetary and financial regulation. A fragmented international-payments infrastructure of a number of parallel systems would only further remove transactions from regulatory purview.

A better plan would be to reform SWIFT itself, by broadening its governance and by expanding the grounds for intervention from anti-terrorism to tax evasion. This is unlikely to happen with Donald Trump in office. But any hope for a more just world necessarily requires raising our sight.