Arusha Initiative for the Democratization of Money at the Global Scale

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Stefan Eich:

“This is almost the complete inverse of Hayek’s call for money to be fully privatized. Many of the G77 countries who in 1974 had been involved with the NIEO began to push in the course of the 1970s for a refounding of the global monetary system. After all, the Great Inflation was not just a phenomenon of the Global North; it hit the South arguably the harder. Furthermore, while many of the recently decolonized countries had not been part of the Bretton Woods negotiations, the Bretton Woods system had at least tied the hegemony of the US dollar to certain obligations and constrained the ability of hot money to flow without constraints.

Where Hayek sees the end of Bretton Woods as an opportunity to complete the privatization and thus the de-democratization of money, countries in the Global South propose addressing the impasse of the post-Bretton Woods non-system by democratizing money on a global scale.

One concrete demand in that direction is put forward in 1979/1980 by Tanzania and Jamaica, two of the first countries to undergo the IMF’s conditional lending and structural adjustment programs. Locked into a political struggle with the IMF, Tanzania’s President Julius Nyerere and Jamaica’s Prime Minister Michael Manley first of all leak internal IMF documents to counter its claims of merely acting as a non-political agent of technocratic adjustment. On top of that, the Arusha Initiative – named after the Tanzanian city of Arusha where the second gathering took place in 1980 – also put forward a set of radical proposals for a new Bretton Woods conference, but now on the floor of the UN General Assembly, where all the recently decolonized countries that didn’t even exist in 1944 during the Bretton Woods Conference would actually have a seat at the table. So contrary to Hayek’s proposal for domestic de-democratization, in the Arusha Initiative we can find a proposal for a global democratic vision of money.”