And speaking of global monetary system conflict, this from the Washington Post:
U.S. presses for fewer Western Europeans on the IMF board
The Obama administration has launched a battle to cut the number of Western Europeans on the board of the International Monetary Fund and make room for more representatives from developing countries.
Taking on a cluster of small nations such as Belgium and the Netherlands, the administration has threatened to to let the board dissolve unless the Europeans give up two or three of the nine seats they hold. The U.S. appointee to the IMF board, Meg Lundsager, in August blocked a vote needed for new board elections, part of an effort to redistribute power within the IMF and, the administration says, sustain the agency's credibility in newly influential parts of the world...
U.S. Treasury Secretary Timothy F. Geithner, speaking at a congressional hearing last week, said the IMF "still has a very unbalanced governance structure," with Western European countries enjoying a "disproportionate share" of spots on the executive board.
But the Europeans are not cooperating, the article continues:
European officials have argued that if they give up executive-director seats, the United States should relinquish the effective veto it has over some IMF decisions and set aside the long-standing agreement under which the managing director of the IMF is chosen from Europe and the president of the World Bank is an American. In a more multilateral world, they argue, the jobs should be open to anyone, something the United States, as the top donor to both organizations, has not yet accepted.
"It is not unreasonable to look for change, and people don't object, but these are big steps," said one European director, who like others interviewed would not speak publicly, because of the sensitivities involved.The article ends with:
"Major changes are underway in the global economy," with Asia leading the global recovery and both population and economic growth in Europe at tepid levels, said Amr Battacharya, director of the Group of 24, a coalition of finance ministers from developing countries. "The issue is where within the developed world should the adjustment take place, and when you look relative to the world economy - population, other indicators - the spotlight really is on Europe."Very interesting development. And expect to see more of this as the Global Financial Crisis evolves. On the one hand, the US has a fair argument, but what will the US relinquish? And what of gold? The EU combined has over 10,000 tons of gold whereas the US has over 8,000 tons. Asia, and BRIC? Their gold reserves are a fraction. So, does Europe acquiesce? Or maybe Europe may have already realized that the current fiat paper standard is approaching the end of an era, and to give in today when the rules of trade may change tomorrow would be a foolish policy?
Mark my words... conflict is the only resolution when it comes to these matters. The US Dollar reserve standard arose from the destruction of WWII. The US, in 1944, had no peer economically. So it was easy to be the lone power calling the shots.
It is a different world today. It is increasingly multi polar and the potential for extreme disagreements over international trade, in an era of financial crisis, resource depletion and increased competition and consumption, is on the rise.