It’s hard to know whether to laugh or cry at the declaration of the New York Times over the weekend that it’s “past time to reform Bretton Woods.” That is the monetary system that was established in the closing months of World War II at Bretton Woods, New Hampshire. The Times wants Congress to buy into a vast (100%) capital increase for the one of the Bretton Woods institutions, the International Monetary Fund, in return for America getting a lower voting share and the Communist Chinese getting more.

What an irony. At the time Bretton Woods was actually being negotiated in the foothills of the White Mountains, the Gray Lady was the scheme’s sagest critic. It published a string of editorials written by Henry Hazlitt warning that Bretton Woods was an inflation trap. When the deal was done, no less a figure than Arthur Hays Sulzberger fired Hazlitt, and the Gray Lady swung behind the very plan against which it had been warning. It was okay to criticize, Sulzberger reckoned, but only until the deal was done.

Sulzberger should have backed his editorial writer, who turned out to have been as right as rain (after leaving the Times, he wrote 900 columns for Newsweek). At the center of the Bretton Woods agreement was a commitment by America to redeem dollars presented to it by the major foreign governments at a 35th of an ounce of gold. But just as Hazlitt had predicted, the scheme was an inflation trap. In 1971, President Nixon closed the gold window, ended the Bretton Woods era, and precipitated us into age of fiat money.

Now America is stuck with two institutions — the aforementioned IMF and the World Bank — that had been born in the White Mountains but are now White Elephants. They should have been broken up and their money distributed to shareholders in the 1970s. Instead the World Bank used American capital to fund, among others, the very communist Vietnam that had been making war against us. The IMF was doling out our money to countries against their promises to devalue their currencies and raise taxes.

Early last year, Congress dug in its heels against cutting more checks to the IMF. It refused to ratify America’s share of an increase in the Fund’s capital — known as quota — to $720 billion. It spurned a deal President Obama and the Group of 20 had agreed to in 2010. Supporters of the deal refer to it as a “reform.” They like to portray it as sparing America the need to commit any “new money” because it would merely make existing loans to the IMF “permanent.” Congress saw through the doubletalk and said no.

In the wake of this the Communist Chinese have plunged ahead with a new treaty, the Asian Infrastructure Investment Bank. This is being greeted with horror by the New York Times, but we have a hard time seeing what’s so bad about it. Let’s see how the Chinese communists fare in the development game. We’ve certainly evaporated a lot of hard-earned taxpayer money trying to cover the shortfalls in the Third World, even as we were failing to cover the shortfalls in our own.

By far the best reform priority for America is to repair what was the central achievement of Bretton Woods: a gold exchange standard to undergird an international monetary system based on constitutional specie. Congress, to which the Constitution grants the monetary powers (and on which it lays the monetary disabilities), is starting to ferment on this question; it is way ahead of the Obama administration on this head. The logic is to fix what broke — as the Wall Street Journal once put it — before pouring more billions of dollars into the IMF.