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Hi there.
Welcome back.
This week we're going to examine the role
that international organizations play in
the world economy.
And we're going to do this,
by developing several of the strands
we've examined all ready in this course.
Now, in this first video, we're going to
trace the roots of the current system of
international organizations.
Now, just for historical accuracy and
I am a historian,
I have to mention that the first
truly international organization, was
the International Telegraph Union, created
in 1865 to establish common standards for
international telegraph communication.
And close on its heels can the general
postal union created in 1874 to
establish common rates for international
postage to ensure that post in
one country was actually
delivered in another.
And to establish the precedent that the
country in which the mail was pasted and
the stamps were bought.
That they could keep the revenues.
And both of these bodies still exist today
under the umbrella of the United Nations.
But the roots of the current
international order
lie in the failure of international
organizations in the interwar years.
After the end of the First World War.
The victorious nations had in 1920
created the League of Nations,
this was an international body designed
primarily to guarantee peace and security
by encouraging negotiation arbitration
to resolve international disputes.
By the time it collapsed into a second
World War, it was evident that
the league had catastrophically
failed ti fulfill its primary aim.
Now, several reasons have been offered for
this failure.
Firstly, the fact that the United States
had failed from the start to
join the organization had robbed
it of its legitimacy and clout.
But given the fact that the American
policy was becoming increasingly
isolationist anyway,
its difficult to say what difference its
membership would've made
to the course of events.
Now secondly, when countries consider that
their expansion as national ambitions were
being threatened,
they simply left the organization.
Germany did this in 1933 when
the Nazis came to power.
Japan walked out in the same
year after the condemnation of
it's invasion of Manchuria.
And Italy abandoned the league in 1937
following the invasion of Abyssinia.
Now less well known but equally important,
are the activities of the League of
Nations in the field of economics.
After the dismemberment of
the Austro-Hungarian empire at the end of
the first World War, the successive states
adopted aggressive trade protection as
policies, as they tried to recreate
viable, national economies.
The league held a succession
of conferences designed to
bring down the level of import
tariffs all without success.
Again, after the onset of
the Great Depression, the League tried,
again without success,
to halt the outward drift of
restrictive trade measures such as
tariffs and quotas, as countries tried to
isolate their national economies
from the downward global spiral.
Once again following the devaluation
of sterling in 1931,
the league tried and
failed to discourage the manipulation of
exchange rates to secure
national trade advantages.
And finally, in 1933, they called
a large international conference in
London designed to bring all of these
issues together, and link them together.
Well, it collapsed and with it's collapse,
the league finally abandoned its
ambitions in this direction.
Again, several reasons have been
advanced to explain the failure.
Firstly, there always seem to be a problem
about agreeing a strategy towards
tackling trade and financial issues.
At a slightly deeper level,
was the fact that the groundwork for
discussion was never adequately
prepared in advance.
The league never had sufficient staff and
more important still, nobody seemed
to see the need for a bigger staff.
League officials never saw it as their
task to prepare detailed recommendations
partly because it was reluctant to
interfere with domestic policy matters.
Now this reluctance to overstep