Preserving the Dollar for the Casino

This essay re-examines the story of the 1978 proposal for a substitution account, an instrument to solve the dollar overhang and enhance the role of Special Drawing Rights introduced by the International Monetary Fund. Beyond its value as a failed attempt to reform the international monetary system, the demise of this initiative highlights the US difficulties in cooling the “casino capitalism” of the late 1970s: from the shortcomings of the multilateralism of the Carter Administration, to the objective of preserving the dollar privilege, to the struggle of conjugating the agency of multiple governmental institutions.