The International Monetary Fund should "increasingly evolve" into an international central bank, enabling it to act as a lender of "last resort" in crisis situations, the Trilateral Commission recommended yesterday.
In a report on "renovating" current international relationships, the commission said that the post World War II "international order . . . is no longer adequate to cope with new global problems."
It said that "wide participation" by many countries would impede the decision-making process, and that the key role should therefore be left to "smaller groups of countries (who) collaborate together."
The Trilateral Commission was formed in 1973 by Chase Manhattan Bank chairman David Rockefeller and Zbigniew Brzezinski, now head of the U.S. National Security council.
The 200 commission members are drawn the business, labor, and academic elite of North America, Europe, and Japan. The commission has been attacked from the left as a vehicle for domination of the world economy by the large multinational companies. Right-wingers have attacked it as a radical front.
The report on renovating the international system was written by Under-Secretary of State for Monetary Affairs Richard N. Cooper, formerly a Yale University professor; Karl Kaiser, professor of political science at Cologne University, and Masataka Kosaka, professor of law at Kyoto University.
On non-monetary issues, the report urged:
Trilateral support of the U.N. environmental program. It acknowledged that most of the world's pollution is in the industrialized countries, which requires them to initiate corrective action.
Access of all countries, developing as well as developed, to nuclear technology, provided they accept international safeguards and controls.
A balance of the goal of human rights "with other important goals of world order." The report said, "Some trilateral conceptions of detente with the Soviet Union and other Communist states tend to conflict with a policy of promoting human rights."
The study acknowledged that the current order has been "severly criticized" by Third World countries, who demand a "more equitable sharing of benefits from the world economy." The report argued for substantially increasing the flow of resources "addressed to alleviating world poverty."
Specifically, it endorsed expansion of loans to stabilize export earnings of developing countries through the International Monetary Fund, or by expansion of the Lome' Agreement wth the European community.
It added that commodity buffer stocks for the purpose of price stabilization should be considered, especially for majors food grains and non-ferrous metals.
The main thrust of the 68-page document is that an interdependent world must be better managed, because there are inherent conflicts between international cooperation and national interests.
The authors suggests that instead of "playing it by ear," the trilateral countries should evolve a strategy for management of the international order that will provide "sense of direction" for the next couple of decades.
As essential goals, they list "keeping the peace, managing the world economy, contributing to economic development and the satisfaction of basic human needs, and prompting human rights."
The report contends that the trilaternal nations "must assume leadership of the system," which will require informal but close collaberation in economic policy making, especially among the U.S. West Germany, and Japan.
It recommends guidelines to keep the various issues separate ("piecemeal functionalism"), accompanied by an effort to decentralize decision making.
The proposal for making the IMF into a central bank was set out in detail to illustrate how the proposed guidelines could be applied to international monetary problems.
The core of a future international monetary system, Cooper-Kaiser-Kosaka say, must be "agreed and operated" by the 5-to 10 biggest countries. The other countries could then adopt " awide variety of arrangements . . . around that central core."
The IMF would provide only a forum for "discussion of ongoing developments," while proposals for formal changes should "originate" with the big powers.
The need for transforming the IMF into a central bank ways said to derive from good management of the flexible exchange rate system, and in order to make Special Drawing Rights (SDRs) the source of most additional monetary reserves. "If SDRS become the principal reserve asset," the report says, "the IMF will play a central role as creator of international reserves."