Abstract: Money Market, Industrial Credit, Foreign Trade: American Assistance Policies and the Shaping of West European Consumer Societies from Bretton Woods through the 1970s Recession
The aim is to reconstruct the role of the U.S. government and the U.S.-backed international economic institutions—namely, the IMF, IBRD, U.S. Treasury, and the Fed—in supporting the recovery of the advanced industrial economies of Western Europe in the light of the 1970s oil crises. This research specifically focuses on the time frame from the first to the second energy crisis. We aim to demonstrate that American international economic policy did endorse a twin growth pattern based on steady domestic real wages and European competitiveness on foreign markets. Accordingly, the talk will bring into focus a set of financial and investment assistance programs carried over during the time frame considered in connection with the financial recycling on the international capital markets of the oil revenues accruing to the oil-producing countries. The specific purpose of the paper is to tackle three main lines of investigation. First, it aims to pinpoint the U.S. financial aid to the European partners' external equilibrium and the domestic European money market. Second, it focuses on the economic aid to nurture industrial investments across the two case studies considered. Third, it investigates the American support to the trade balance of West European partners. In so doing, we maintain that during the floating 1970s Washington consistently supported a specific European mass consumer growth that combined high real wages at home and high trade integration on foreign markets. Accordingly, this research pinpoints American economic assistance to keep the European foreign exchange rates stable, to support the domestic investment markets, and to redress the trade balance of the European economies.