The sold-out Jackson Hole Summit, which seeks to be a conservative counter-balance to the Kansas City Federal Reserve’s Jackson Hole Symposium, kicked off with a fascinating history lesson by a Director of the Council on Foreign Relations on how the Bretton Woods Conference at the end of WW II led to the massive monetary expansion of Federal Reserve and impoverishment of America.

Benn Steil, Ph.D., in his book The Battle of Bretton Woods, credits the roots of central banks printing trillions in paper currency, suppressing interest rates, and manipulating markets to a post-war world designed by President Franklin Roosevelt’s chief U.S. negotiator Harry Dexter White, a Treasury official later was unmasked as a Soviet spy.

Mr. Steil highlighted that the gold-based monetary system expired in 1914 after a century of long-term price stability, peace and prosperity. After WW I, the world moved to a supposed “gold-exchange” standard that was really based on paper money exchange and led to price instability, war and depression over the next 30 years.

The 1944 conference at Bretton Woods in New Hampshire brought together 44 nations to design a system to regulate international money and banking. The two key players at the conference were Harry Dexter White and the UK’s John Maynard Keynes. At the time of the conference, the dollar represented 1/35th of an ounce of gold; 71 years later the dollar represents less than 1/1,100th of an ounce of gold.

Harry Dexter White went to Washington in 1934 to be a key actor in drafting the Roosevelt Administration’s long-range socialist agenda. In 1944, he and many Roosevelt appointees were huge advocates of the Soviet Union. White wrote, “Russia is the first instance of a socialist economy in action. And it works!” Just before the conference, he publicly advocated that government should control and direct the means of production.

The UK’s John Maynard Keynes went to Bretton Woods with a willingness to agree with everything demanded by White and the U.S. negotiators, as long as he could extract the largest amount of cash from the U.S. Treasury to win the war in Europe. Keynes fully understood that although Bretton Woods claimed to be establishing a post-war economic order where the value of money would be fixed, the agreement gave governments a capability to unfix monetary values every time there was a “crisis”.

The Bretton Woods Agreement made the dollar convertible into gold and all other currencies convertible into the U.S. dollar. Depression and wartime-era restrictions on trade required to be torn down with the World Bank and the International Monetary Fund, both dominated by the U.S., given broad authority to implement this grand design.

White assured the House Banking Committee in 1945 that “There is no likelihood that… the United States will, at any time, be faced with the difficulty of buying and selling gold at a fixed price freely.” He assured Congress that the Bretton Woods Agreement meant that America would continue to be the world’s top creditor nation because the dollar would be the only “reserve currency.”

But the Bretton Woods new world order rules morphed over the next seventy years from the Federal Reserve being required to exchange dollars for gold to the elimination of U.S. metal convertibility for the dollar, to the ability of the Fed to engage in actions like multiple rounds of “quantitative easing” that has led to the U.S. becoming the world’s largest debtor.

Dr. Steil advocates a return to a form of the classic gold standard that would be relatively self-regulating and feature timely settlement of international debts through fully convertible currencies.