Sarkozy's call for creating a "new monetary order"

Sarkozy's call for creating a "new monetary order"

Speaking at the 8th Europe-Asia Summit a few weeks ago, President Sarkozy of France called for a "new monetary order".
This week, he tried to rope in the support of China's President Hu.
At the Europe-Asia Summit, President Sarkozy put it this way: "we live in a world where monetary imbalances are putting all our economies at risk. Let me take two examples: do you know that since 1990 the world has experienced 42 currency crises? 42 times, whole countries in Asia and Europe have been literally drained of their capital. Secondly: 1974 saw the creation of the G7 – which became the G8 – to talk in particular about monetary problems. Today the G7 forum is no longer the legitimate one in which to talk about them. Why? Because, for example, China isn’t a member of the G7. So today, in 2010, we haven’t got a single place where, in the world, we can talk about monetary questions. Every country does what it wants, tries to safeguard its sovereignty, but we are living in the 21st century without a monetary order. We’re living on the basis of the Bretton Woods fiction that there is only one economy and one currency. We clearly need to define a new monetary order. Where do we discuss currency issues? Aren’t currencies a matter of concern to heads of State and government? Does every world region have to accumulate reserves in order to avert a crisis? These are issues we have to address and resolve".

Reading between the lines, Sarkozy may be leaning towards the creation of a single global currency.

If so, it would lead to huge concentration of power with attendant abuse - and therefore a disaster for civilization.

Far better to let currencies (and, by implication, governments) compete.

How then to address global imbalances? By addressing them at the level of the root cause. And that is a world trading rules which exclude environmental and human concerns, thereby tilting the board towards countries such as China which pay no attention to such concerns. Include environmental and human concerns in the WTO's rules, and we would not only sort out global imbalances but also lay the foundation for a genuinely humane global civilisation for the first time in history. Sphere: Related Content