False Internationalism

October 16, 1961

LONDON—The main impression left by a month’s visit covering France, Italy, Switzerland, Austria, and the British Isles is that the political and economic problems of individual countries are today overshadowed by their common international problems. By this I do not mean only the threat of a third world war of unparalleled devastation, but immediate day-to-day problems. We are witnessing, for example, an almost simultaneous crisis in the international organizations that were set up in 1945 or later with a great flourish of trumpets, based on utopian hopes, emotional catchwords (like “one world”), and false political and economic assumptions.

The main crisis is in the main organization, the United Nations. This is not merely the result of the death of its Secretary-General, Dag Hammarskjöld, but of cumulative experience of the ineffectiveness of the U.N. in solving or averting any major dispute or crisis. Nearly five years ago, even before more than a score of tiny new Asian and African “nations” were created and admitted, Viscount Cherwell pointed out that in the Assembly, “the ultimate governing body of the U.N. . . . 5 percent of the world’s population can carry the day against the other 95 percent.” To rely on the U.N., he thought, was “to live in a fool’s paradise.” It is “nonsense,” he concluded, for nations to submit their “vital interests to a body so absurdly constituted.”

COMMON MARKET

The culminating result is the spectacle in the Congo of the United Nations resorting to military force to try to compel Katanga to get rid of its Western advisers and “unite” under a Communist-dominated confederation. This denial of the right of self-determination, elsewhere one of the great slogans of the U.N., has shocked a substantial section of British opinion. Many Britons are baffled by the apparently incurable determination of our government to abdicate its own moral responsibility and put its conscience in the hands of other nations.

The British are having their own troubles with one of the new international organizations, the Common Market. They are deeply divided on the wisdom of joining it. They fear that the political result may be to break up the Commonwealth. They are not sure whether the economic result will be to carry them in the direction of freer trade or of more protection. For if they would have to lower their tariffs against European industrial goods, they fear that the might have to raise them against agricultural products and raw material from the Commonwealth as well as other countries. If there were a true world will to freer trade, some point out, no such discriminatory organization as the Common Market would be needed. Each nation would simply reduce its own tariff barriers and accept the nondiscriminatory most favored-nation principle.

MONETARY FUND

One international organization certain to get more critical scrutiny than it has ever received before is the International Monetary Fund. The U.S. Government is trying to postpone the necessity for putting its monetary house in order by building up the reserves and lending capacity of the fund. But it is becoming clear to the world’s monetary economists that the fund, with its credits and “drawing rights,” has been a powerful contributory force in keeping world inflation going. There is ultimately no substitute for each nation’s responsibility to keep its own currency sound.

This responsibility devolves above all on the U.S. As Groseclose, Williams & Associates put it in a recent (July–August) Washington Letter: “With dollars and sterling (mainly dollars) as 45 percent of the backing of the free-world currencies, the importance of a sound dollar to the free world is plain. The maintenance of the value of the dollar thus becomes the most important task of the U.S. Government both at home and abroad.

Yet, ironically, we are undermining the value of the dollar by a huge domestic spending program, a huge “foreign-aid” program, cheap-money policies, and a prospective deficit this fiscal year of more than $6.5 billion. Where we could have helped other nations most by keeping ourselves strong, we are threatening world stability by weakening our own position.