NOBODY, in practice, really likes floating exchange rates very much. Currencies swing madly and unpredictably up and down, causing embarrassment among politicians and heart attacks among manufacturers. Floating is the worst possible monetary regime except, to borrow a famous line, all the others. Recognizing that truth, the International Monetary Fund's interim committee ended its meetings here with a decision to abandon the idea of a world conference to reform the system.
That idea enjoyed a brief prominence last winter when President Reagan called for "reliable" exchange rates in his State of the Union address. "We must never again permit wild currency swings to cripple our farmers and other exporters," he said, and he told the secretary of the treasury to consider whether a world conference should be held to straighten out the rates. The IMF seems to have delivered the answer.
The political constituency for stable exchange rates, in any country, is above all the producers -- not only the farmers but everyone else who grows, mines or fabricates goods that can be traded across borders. Americans sometimes look with envy at the European Monetary System, the working model for the proposals to establish limits, or target zones, within which the world's currencies would be held. But the European agreement works because European governments follow domestic economic policies that are consistent with each other. Because the United States has been following policies that are not consistent with Europe's, there is no way to hold their currencies in a constant relationship to the dollar.
Recent experience illustrates the point unpleasantly clearly. In the 1980s Europe has been running a sharply restrictive policy, trying to get budget deficits down. The only important exception was France's fling at reflation when the Socialists took power, and that didn't last long. In contrast the United States has been running very large budget deficits since 1982, when Mr. Reagan's tax cut began to take effect. The brake in Europe and Japan, pulling against the accelerator in this country, pushed the dollar up. That in turn hurt American exports, encouraged imports and produced the gigantic trade deficits that now bring demands from American industry for more stable exchange rates.
But there's no reform of the exchange rate machinery that can produce them as long as the United States, Japan and Europe follow conflicting economic strategies. If they choose to bring their plans into harmony, the present exchange rate markets will produce stability without further reforms. That's a choice for Mr. Reagan and his colleagues to talk about at their economic summit meeting next month in Tokyo.