IMF’s “generosity” imprisons generations in debts that only grow

IMF gold windfall helps poor countries now but won’t break cycle of debt

By subsidising cheaper loans to low-income countries, the IMF will keep them trapped by debt repayments for years

MDG : IMF and debt payment : Demonstration in Lisbon Portugal

[A demonstration against the IMF and austerity policy in Lisbon. Are IMF loans maintaining a debt crisis for low-income countries? Photograph: Jose Elias/Alamy]

The countries that run the International Monetary Fund (IMF) have decided to spend a $2.7bn (£1.7bn) windfall on subsidising cheaper loans to low-income countries. This will represent a small financial benefit for countries taking such loans, but leaves unchallenged what such loans and debt exist to do.

In the mid-2000s, the IMF faced a financial crisis as middle-income countries such as Argentina and Brazil paid off their debts to the institution. The fund’s $1bn costs are paid for by the interest it charges on loans, and its income dried up as countries got off lending programmes, scarred by two decades of austerity and liberalisation.

The IMF decided to sell off some gold, invest the money earned, and use the proceeds to run the institution. Then the financial crisis hit; a crisis the IMF had not only systematically failed to warn of but had helped to precipitate through its praise of light-touch regulation. Lending by the IMF has ballooned along with its income: this year a profit of $2.2bn has been made on loans to countries including Pakistan, Jamaica, Ireland and Greece. And with gold prices rising, far more money than predicted came in from the sell-off, leaving a $2.7bn windfall. Continue reading

Greek puppet/”minister of economics” signed onto IMF “austerity” plan without reading it

Minister Manolis Chrysochoidis. Photo by Flickr user Piazza del Popolo (CC BY 2.0).

Minister Manolis Chrysochoidis. Photo by Flickr user Piazza del Popolo (CC BY 2.0).

Shock and awe awaited Greek citizens on Monday January 23, 2012, when Louka Katseli, former minister of labour and social security (2010) and minister of economy, competitiveness and shipping (2009), revealed that she had had only three hours to read the IMF memorandum tackling the country’s debt crisis.

Michalis Chrysochoidis, current minister for development, competitiveness and shipping and former minister of citizen protection, admitted on a morning television show interview [el] that he signed the IMF memorandum without having read it at all, arguing that “simply, he had other obligations during that time, as he was fighting against crime”:

Minister Manolis Chrysochoidis. Photo by Flickr user Piazza del Popolo (CC BY 2.0).

News spread quickly on the web reacting to the remarks, including extremely negative comments and derogatory insults from netizens, expressing their disdain for the political system, and mocking the minister’s excuse.

Within one to two hours, the case became a world trending topic via the Twitter hashtag #de_diavasa_to_mnimonio_giati (I didn’t read the memorandum because…):

Festive Roman crowds cheer end of Berlusconi era

[In the midst of the worst economic crisis since World War 2, the arrogance of power is shaken as, in many countries, oligarchs and dictators and billionaires are forced to exit the centers of power in growing disgrace.  Today, the people poured into the streets in Italy today to celebrate the departure of the hated Berlusconi.  We will see what struggles the people will be able to bring against the chokehold of capitalism in the months ahead… — Frontlines ed.]

By Cristiano Corvino and Gabriele Pileri, Reuters

ROME (Reuters) – Thousands gathered in Rome to celebrate the political demise of Silvio Berlusconi on Saturday, whistling and shouting insults as the 75-year-old media magnate drove to hand in his resignation as prime minister.

In an atmosphere reminiscent of a football World Cup victory celebration, squares outside government buildings were packed with cheering crowds, singing and chanting as the curtain came down on Berlusconi’s scandal-hit government.

Police held back the crowds behind barriers outside Berlusconi’s private residence in central Rome and in front of the Quirinale Palace, the residence of the head of state, President Giorgio Napolitano.

A small orchestra played the Hallelujah chorus from Handel’s Messiah as the crowd waited for Berlusconi to appear and hand in his resignation. Continue reading

Beware ‘social justice’ promises by international bankers

by Patrick Bond

2011-10-13, Issue 552, Pambazuka


‘In these days of dire economic and environmental crisis, with political elites under attack from Athens to Washington, the establishment is desperate for legitimacy. Even International Monetary Fund (IMF) staff now publicly endorse ‘social justice’ at the same time they tighten austerity screws,’ writes Patrick Bond. Someone needs to hold them to account.

In these days of dire economic and environmental crisis, with political elites under attack from Athens to Washington, the establishment is desperate for legitimacy. Even International Monetary Fund (IMF) staff now publicly endorse ‘social justice’ at the same time they tighten austerity screws. Continue reading

Protests turn violent in central Athens

October 6, 2011
More than 30,000 public sector workers demonstrated in Greece in a strike against deeper austerity cuts that closed courts, schools and transport, including air transport.

Police clashed with demonstrators during a protest rally marking a 24-hour general strike on Wednesday in Athens.

By Rosie DiManno, Toronto Star
ATHENS—The menacing black-clad anarchist, who had just hurled rocks at riot squad cops, ducked exploding tear gas canisters and been chased through the streets with a police dog nipping at his heels, lowers the bandana from his face.

He’s 19: Economics student at the University of Athens, son of a taxi driver father and hospital food worker mother, part-time fitness instructor, despondent about his future, furious and frightened.

“My heart is beating so fast, I can hardly breathe.”

The stick in his hands seems such a feeble weapon of rage.

Sticks, stones, chunks of concrete, Molotov cocktails — this is the arsenal that some of Greece’s youth have brought to the barricades against a powerful state. A generation ago, their parents toppled a military junta. Protest is in their bones, a legacy. Continue reading