European leaders call for a new Bretton Woods-type agreement as they meet in Brussels.
A global financial crisis of the current magnitude is unique. But two historic events offer lessons for a way out, say economists.
First, move with alacrity. During the Great Depression a protracted delay in aiding banks proved fatal – a lesson Britain and now, this week, the United States have taken on. Second, coordinate globally. The Bretton Woods agreement near the end of World War II became an effective tool for reworking a shattered world economy. Calls for a second Bretton Woods are now being sounded by such figures as Britain's Prime Minster Gordon Brown, French President Nicolas Sarkozy, and World Bank president Robert Zoellick.
Central to European leaders discussions Wednesday and Thursday in Brussels is this motto: A global crisis requires a global solution. The subtext is that much tougher regulation is required. As Mr. Brown put it Monday, "Sometimes it takes a crisis for people to agree that what is obvious and should have been done years ago can no longer be postponed. We must create a new international financial architecture for the global age."
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