I don't understand what the problem was with international relations during the Great Depression when Franklin Roosevelt was president.
something about exchange-rate stabilization.
That FDR refused to take part in.
Mainly, I don't know what the problem was and how he tried to fix it?
During the Great Depression, international relations faced several challenges, including issues with exchange-rate stabilization. When Franklin Roosevelt was president, one of the main problems was the destabilization of exchange rates due to various countries abandoning the gold standard. As a result, currencies fluctuated widely, leading to economic uncertainty and hindering international trade.
To address this problem, many countries sought to stabilize exchange rates through cooperative agreements. One such agreement was the World Economic Conference, scheduled for 1933, aimed at coordinating global economic policies and stabilizing exchange rates. However, FDR refused to participate in this conference for two primary reasons:
1. Domestic Policy Priorities: Roosevelt prioritized addressing the domestic economic crisis as his administration implemented the New Deal, a series of domestic initiatives to revive the U.S. economy. Focusing on domestic policies, he believed, would have a more direct impact on recovery rather than participating in international conferences.
2. Monetary Policy Differences: FDR had reservations about the approach to exchange-rate stabilization, primarily based on his belief that other nations must reflate their economies to stimulate growth, rather than adhering to strict monetary policies like returning to the gold standard. He advocated for a departure from pre-Depression monetary norms and adopting more expansionary policies to combat the economic slump.
Instead of participating in international efforts for exchange-rate stabilization, Roosevelt focused on domestic economic recovery through policies aimed at stimulating production, reducing unemployment, and increasing consumer purchasing power. These efforts, such as the National Industrial Recovery Act and the Agricultural Adjustment Act, were intended to restore confidence, stabilize prices, and increase employment within the United States.
Overall, FDR's refusal to participate in international exchange-rate stabilization efforts during the Great Depression was mainly due to prioritizing domestic economic recovery and advocating for a departure from pre-Depression monetary norms to combat the crisis.
During the Great Depression, international relations were greatly affected by economic instability. One of the key issues was exchange-rate stabilization, which refers to the efforts to maintain stable currency exchange rates between different countries. Franklin D. Roosevelt (FDR), the president of the United States at the time, faced challenges in dealing with this issue.
The problem arose because many countries had adopted protectionist policies in response to the economic crisis. These policies aimed to protect domestic industries and jobs by raising tariffs and imposing restrictions on imports, but they often came at the expense of international trade. As a result, global trade declined, exacerbating the economic downturn.
To address this issue, countries began discussing the possibility of stabilizing exchange rates. This involved establishing fixed exchange rates or cooperative agreements to manage currency fluctuations. The hope was that stable exchange rates would encourage international trade and economic recovery.
However, FDR's administration had reservations about committing to exchange-rate stabilization. The primary reason was that they believed fixing exchange rates could hinder domestic economic policy flexibility. By keeping exchange rates flexible, the United States could maintain control over its monetary policy and use it as a tool to address domestic economic challenges.
Instead, FDR focused on domestic recovery efforts, such as implementing his New Deal policies, which aimed to stimulate the American economy. He prioritized strengthening domestic industries, providing jobs for the unemployed, and stabilizing the national economy before fully engaging in international economic cooperation.
It is worth noting that although FDR initially distanced himself from exchange-rate stabilization efforts, his approach evolved over time. As the Great Depression persisted and evolved into World War II, he recognized the importance of international economic cooperation. Eventually, the United States became actively involved in post-war efforts to establish a new international economic system, leading to the establishment of institutions such as the International Monetary Fund (IMF) and the World Bank.
Overall, the problem with international relations during the Great Depression related to the decline in global trade and the adoption of protectionist policies. FDR's administration was cautious about committing to exchange-rate stabilization, prioritizing domestic recovery efforts instead. However, over time, the United States became more involved in global economic cooperation.