Progressives Oppose the Out of Control IMF
|January 9, 2007||Posted by Staff under Archive, Progress Report, The Progress Report|
Intelligent Leaders Oppose the IMF
Here’s a very recent update from the “50 Years is Enough” coalition.
Thursday – August 6, 1998 The progressive opposition to the International Monetary Fund (IMF) in the U.S. Congress made its presence known this morning with a press conference outside the Capitol Building. Representatives George Miller (D-California), Bernie Sanders (I-Vermont), Dennis Kucinich (D-Ohio), and Cynthia McKinney (D-Georgia) spoke to a group of reporters about their reasons for opposing expanded funding for the IMF.
The Clinton Administration is pressuring the House to add $14.5 billion to an appropriations bill to pay for a “quota increase” that would expand the IMF’s capital base by 45 percent. The Senate has passed a bill authorizing the funding, but the House has so far resisted. Mainstream press reports have highlighted Republican opposition to the IMF in the House; today’s press conference demonstrated that progressive Democrats (and Congress’s lone Independent) also oppose the Administration’s plans for the IMF.
As Representative Kucinich’s statement revealed, Democratic opponents of the IMF share the skepticism expressed by leading Republicans about the reputed shortage of available funds for further IMF bailouts. Kucinich enumerated the different sources the IMF can turn to for cash and came up with a total of some $190 billion that the institution can draw on — a far cry from the $10 billion figure that Assistant Secretary of the Treasury Lawrence Summers suggested in a speech on Tuesday to the National Association of Governors. That figure, Kucinich pointed out, fails to reflect the many credit lines and different accounts available to the IMF.
Representative Miller, the ranking Democrat on the House Resources Committee and one of Congress’s leading environmentalists, noted that the economic policies imposed by the IMF in exchange for its loans have failed to consider even short-term environmental impacts. IMF pressures to generate exports for hard currency have led to the massive overexploitation of resources around the world. Miller gave the example of Indonesia, which has rapidly expanded its palm oil exports at the expense of one of the last great rainforest ecosystems. The wholesale destruction involved in this expansion was a major contributing factor to the fires, smoke, and haze that caused many health problems and the closing of airports and other facilities in Southeast Asia earlier this year.
Representative Sanders attacked the IMF’s programs for protecting rich banks and investors at the expense of the poor in IMF client countries. He accused the IMF of acting as a guarantor of foolish loans made by foreign banks in countries like Indonesia, South Korea, and Russia — all recent recipients of IMF bailouts. But, Sanders pointed out, while the IMF rushes in to protect rich banks from any losses incurred in countries where they have been making big profits for years, it does nothing to safeguard the interests of the hundreds of millions of people in these countries who will assume the debts racked up under the bailouts. Instead, the poor and middle classes of those countries suffer massive layoffs, cutbacks in health and education spending, increased national debts, increased interest rates, failures of thousands of small businesses, and the takeover of whole sectors of their economies by wealthy foreign corporations and investors.
Representative McKinney protested the IMF’s sham “debt relief” programs, and suggested that Congress should insist on a commitment from the IMF to meaningful debt reduction before it appropriates any more money for the institution. Existing IMF debt relief programs, she pointed out, do not reduce debt burdens so much as seek out the maximum amount countries can pay each year without defaulting. The result if often greater amounts of capital than ever leaving poor countries to repay institutions like the World Bank and the IMF. McKinney noted that countries like Mozambique — by many measurements the world’s poorest country — “benefit” from highly-touted debt relief programs yet still pay more to their creditors than they do on health and education combined. Given the plight of people like Mozambique’s, the IMF’s cries of destitution — and the claim that they alleviate the plight of the poor around the world — ring hollow in the halls of Congress.
McKinney concluded her statement by picking up a mallet and stabbing a pinata in the shape of a dinosaur. The dinosaur, she said, represented the attitudes and policies of the IMF. Her attack on the pinata, assisted by Representative Kucinich, symbolized these Democrats’ determination to pierce the myths of invincibility and benevolence the IMF wraps itself in.
What do you think? Why doesn’t everyone in Congress see the IMF as destructive, secret, and out of control? Will you contact your Congressperson on this issue? Tell The Progress Report!