The process of internationalizing finance and
the interstate capital movements will always be hard to resolve for the global
politics. Financial integration generates both domestic and international
winners and losers so this process brings about distributional tensions and
political interventions. The Bretton Woods system, which was put in place in
1944, is considered a first-rate military operation staged by the Western
Powers to create an institutional framework to handle these tensions. The
essence of Bretton Woods was to combine the aspects of facilitating orderly
capital flows with the characteristic feature of preservation of national
policymaking autonomy. This paper analyzes the political framework of Bretton
Woods and explores the goal of the regime to balance the USA interests with
those of the other major economies as its final failure. The Bretton Woods
agreement may have resulted in the most open period in economic history, but
also a collapse that raised the issue of co-operation between global market
forces and national policy. Although global finance continue to have their
political complexities today, it is still in need of continuous debate in the
absence of this institutional design