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In short: I don't think it's likely that a 'New Bretton Woods' will emerge from the ashes of the old. But if it does, the issues policymakers will have to contend with look similar, if not more complex, than they were in 1970: we have no choice but to learn from the past.

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In the full piece, I touch on the implications of these facts for international monetary affairs today - from a lack of adjustment mechanism for Chinese current accounts surpluses to the unlikelihood of a 'United States in 1944' type of power imbalance facilitating international agreement.

Third, the United States simply lost interest in international monetary leadership over this period, particularly under Richard Nixon. Daunton pulls dozens of quotes from the archives to establish this point; I excerpt a few particularly fun ones here.

Daunton digs up an almost comical number of quotes from Richard Nixon and his top officials about their disregard for these problems, including (but not limited to):

“I do not want to be bothered with international monetary matters… I will not need to see the reports on international monetary matters in the future”.

“Political considerations must completely override economic considerations in monetary and trade talks”.

“I don’t give a shit about the lira”.

Treasury Secretary John Connally, who oversaw the Nixon Shock of 1971 and the collapse of Bretton Woods, was not much better. His basic approach is summed up by Daunton in his own words: “The foreigners are out to screw us. Our job is to screw them first”.

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Second, the American decision to prevent Bretton Woods from including a forced adjustment mechanism for creditor nations—at the time favoring the United States—backfired by the 1970s, when it was Germany and Japan that had accumulated the persistent surpluses that would undermine the system.

Daunton focuses on three other arguments, based on incredibly rich archival research. First, the balance of political and economic power had shifted from 1944, when the United States and United Kingdom held near-complete authority, to the 1970s, when no group of powers was equipped to dictate terms.

This essay focuses on the period from 1949 to 1973, as the Bretton Woods system moved from the bedrock of the global economy to collapse. I review Daunton's arguments about this period, which move beyond the standard story that 'structural imbalances' were to blame.

unevenandcombinedthoughts.substack.com

New from me, on the wonderful @angusbylsma.bsky.social's blog: an essay about the collapse of Bretton Woods and the possibility of building such a system anew today, and a review of Martin Daunton’s comprehensive history of The Economic Government of the World.

Slouching Towards Liberalization

The Economic Government of the World, Martin Daunton, 2023 (Pt.II).

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Reposted by Sam Thorpe

Kevin Rinz @kevinrinz.bsky.social · 26/05/2026

New working paper out today for the real UI heads, from me and David Wasser: ⬆️ UI generosity - ⬆️ wages - for UE, J2J, and EE workers - especially at the bottom - ⬇️ hiring from U - ⬇️ LF exit - maybe ⬇️ job postings - ⬆️ posted wages - ⬆️ new entrant hiring - and more!

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In your view, how much of this is a story about policy change over time vs. a more secular trend in wealth accumulation with rising asset prices and tax competition around the world?

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This makes sense. Really appreciate the distinction between policy agendas and personalistic representation in the article, + the recognition that 'leaderful' movements have struggled to build effective outside pressure campaigns. Both crucial for an effective I-O strategy. Thanks for a great piece.

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(For what it's worth, I completely agree with your argument! Just would love to know more on how you're thinking about inside-outside in this context.)

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Out of curiosity - do you have a preferred explanation of the inside-outside strategy as you use it here? It seems like the academic literature (and even public-facing writing) on this is basically nonexistent, and everyone is operating with subtly different definitions and goals.

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And lovely bonus passage on 'taste': The question “who am I”... [has been replaced] with “what do I consume”, and which, in turn, has become inverted, where I consume whatever turns me into a specific type of person I aspire to be… [We] are looking for a shortcut to [our] own inner life.

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Sam Thorpe @samthorpe.bsky.social · 23/05/2026

As usual, incredibly thoughtful stuff from Maia. I found the arguments (referencing Andrew Caplin's new paper) about the shift in costs from 'finding information' to 'asking questions and directing inquiry' particularly interesting. Great pairing with the new papal encyclical.

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Absent an effective estate/inheritance tax, eliminating it makes sense, but if you taxed inheritances above some exemption (e.g. $1m) as regular income as @lilybatch.bsky.social and others have proposed (good policy!), step-up is probably a necessary evil to avoid appearance of double taxation.

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Sam Thorpe @samthorpe.bsky.social · 23/05/2026

Would love to hear Zach's answer on this. I'll just toss out that while I think eliminating step-up is good policy in isolation, it makes it hard to do a broad-based estate or inheritance tax. (Selling assets to pay the tax and having to pay capital gains tax on the sale could add up to >50% MTRs.)

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Sam Thorpe @samthorpe.bsky.social · 17/05/2026

I made up a prettier version of this sorted by effect size back in 2023 to include in our brief, but we ended up cutting it for space... still kick myself sometimes that I didn't fight to keep it in, as it seems like a great single-figure summary of all the differences!

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Sam Thorpe @samthorpe.bsky.social · 17/05/2026

This is a fantastic summary - and it always makes me happy to see Bill, John, and my review cited in teaching like this! If you have space, you might consider including AS table 4, which lays out the quantitative importance of each difference between the two approaches as of 2024.

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Sam Thorpe @samthorpe.bsky.social · 16/05/2026

I'll be writing about a wide range of topics, a sample of which are excerpted below. This is not a complete list; I'm excited to branch out into all sorts of questions outside my published research. If you've enjoyed my research and commentary here, please hop on and subscribe. (It's free!)

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Sam Thorpe @samthorpe.bsky.social · 16/05/2026

I came to economics originally from philosophy and political theory; I've always had interests in this sort of work. But the econ publishing process makes it challenging to think deeply about those questions, and as I move into a year focused on research and writing, I wanted an alternative channel.

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Sam Thorpe @samthorpe.bsky.social · 16/05/2026

Against my better judgement, I've finally started a (free) Substack. As I explain in my first post, I see this as an avenue to write on some of the big questions that economics research isn't well-suited to: normative claims, historical work, and thinking about the roots of economic analysis.

thestockexchangeandtheholygrail.substack.com

Kicking things off

About me, about this blog

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Sam Thorpe @samthorpe.bsky.social · 31/03/2026

A fun bit of history: this is the conclusion of Ben Bernanke's speech on the occasion of Milton Friedman's 90th birthday. (Delivered in 2002!) www.federalreserve.gov/boarddocs/sp...

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All this is to say: the mild increase (real $) / mild decline (GDP share) in welfare spending is probably not a primary driver of these political changes. But some of the other economic consequences of an era of relative decline for a specific subgroup of the US population could be important.

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Working on a paper on this, but you can imagine a world where a mild increase in income and consumption inequality (below) + a dramatic increase in the ease and frequency of interpersonal social comparison has pretty meaningful effects, esp. with a Fred Hirsch / Robert Frank-shaped utility function.

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In general, the argument that economic anxiety / falling living standards explain the political changes we've seen over the last decade is clearly an oversimplification. But it seems plausible that *relative* changes in well-being for wealthy and working-class americans might have played some role.

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