NY Times on the “Liberalizing” of the International Monetary Fund

[The IMF and the World Bank are key instruments of the finance/montary/credit-debt management of the entire world.  Enacted at the end of WWII to establish US leadership of the world imperialist system, both IMF and WB have come under endless criticism and challenges over the decades, but the emergence of new imperialist powers from post-socialist Russia and China has posed historically-contending  blocs-in-formation as unprecedented dangers to the once-presumed “permanent” US hegemony.  Both IMF and WB have become increasingly tattered and less effective instruments, as challenges have grown.  Congressional reforms aimed at a more durable structure for the IMF are hailed by the media-of-empire NY Times in the following editorial, which writes, strategically, ‘If the fund and the World Bank are to remain relevant and be truly global organizations, they cannot be seen as European and American fiefs.’ — Frontlines ed.]

Congress Gets Out of the I.M.F.’s Way

By The New York Times EDITORIAL BOARD, December. 22, 2015

The House went into holiday recess after passing a measure that included ratification of International Monetary Fund reforms.

After five years of Republican foot-dragging, members of Congress last week ratified an agreement that will increase the capital of the International Monetary Fund and give developing countries like China and India a greater say in the organization.

This should strengthen the fund at a time when its expertise is needed to help revive a slowing global economy. In 2010, the Obama administration negotiated an agreement with other countries to double the I.M.F.’s capital to about $755 billion, so it could lend more money to troubled countries like Greece and Spain. The changes also gave more voting power in the fund’s management to China, India, Brazil and Russia while slightly reducing the clout of European countries and the United States. Continue reading

US Empire: Crusty, Hulking, Feet of Clay, Short of Breath and Challenged

[The clock is ticking uncomfortably fast, apparently–Frontlines} Janet L. Yellen, chairwoman of the Federal Reserve, checking the time after a financial ministers and governors photo on Friday. Credit Gary Cameron/Reuters

WASHINGTON — As world leaders converge here for their semiannual trek to the capital of what is still the world’s most powerful economy, concern is rising in many quarters that the United States is retreating from global economic leadership just when it is needed most.

The spring meetings of the International Monetary Fund and World Bank have filled Washington with motorcades and traffic jams and loaded the schedules of President Obama and Treasury Secretary Jacob J. Lew. But they have also highlighted what some in Washington and around the world see as a United States government so bitterly divided that it is on the verge of ceding the global economic stage it built at the end of World War II and has largely directed ever since.

“It’s almost handing over legitimacy to the rising powers,” Arvind Subramanian, the chief economic adviser to the government of India, said of the United States in an interview on Friday. “People can’t be too public about these things, but I would argue this is the single most important issue of these spring meetings.”

Continue reading

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

Greece: Bloated military and economic collapse

[Some may suggest that Greece pay back its creditors in rusty tanks and leaky submarines–not Euros. — Frontlines ed.]
——————————
February 21, 2012

Sell Them Tanks, Then Call Them Profligate

Germans, French Were Keen to Sell Arms to Greece

by PATRICK COCKBURN, writing for Counterpunch

Athens — As Greeks waited for a second eurozone rescue package to finally be agreed in Brussels today, many were blaming Germany and France for encouraging and benefiting from some of the much-criticized profligate spending that reduced Greece to near bankruptcy.

About 1000 protesters gathered in front of the Greek Parliament in central Athens yesterday, while riot police waited to see if there would be a fresh confrontation. But, in general, Greeks are resigned to the new package of austerity measures which will cut jobs in public service and slash pensions and the minimum wage.

Hopes are high that the eurozone ministers’ meeting today will agree to the €130 billion bailout after Athens detailed the new budget cuts.

While most Greeks are critical of the reforms on which the troika of the EU, International Monetary Fund and European Central Bank are insisting, many also feel that Germany and France share some of the blame for Greece’s overspending.

Over much of the past decade, Greece – which has a population of 11 million – has been one of the top five arms importers in the world. Continue reading

Greek anger boils over as country faces bankruptcy

Several people have been arrested in Athens amid a two-day strike over austerity measures. Msnbc.com’s Dara Brown reports.

ATHENS — Black-masked protesters threw Molotov cocktails, stones and bottles and police fired teargas during clashes in central Athens Friday, as striking Greek workers denounced a new wave of austerity Friday as an imposition too far by Europe and the International Monetary Fund.

Finance Minister Evangelos Venizelos told the nation it faced a stark choice between sacrifices inside the euro area and bigger sacrifices outside it.

The clashes in central Athens came at the start of a 48-hour general strike against planned pay and job cuts.

The Guardian newspaper reported that “running battles” broke out between protesters and police, with clashes in Syntagma Square.

‘Resist!’
Some protesters compared Greece’s plight, facing bankruptcy unless it accedes to the demands of international lenders, to its seven years under military dictatorship.

People in the Syntagma sang songs from the struggle in the 1960s and 1970 against a junta of colonels boomed out over loudspeakers.

“Do not bow your heads! Resist!” they chanted. “No to layoffs! No to salary cuts! No to pension cuts!” Continue reading

Going Underground in Hard Times

[As countries across the world sink deeper into capitalist crisis, and relief, though promised, only leads to more “austerity” measures–cuts in basic services, growing unemployment, higher taxes–growing numbers have moved to the “informal”, “underground”, “grey market” economy, outside of official and governmental review, regulation, and control.  In many countries this amounts to one-third to one-half of the economy.  This article about the underground economy in Portugal traces such growth in response to official crisis and bankruptcy. — Frontlines ed.]

—————————————————–

By Mario Queiroz

LISBON, Jan 28, 2012 (IPS) – The underground economy in Portugal is booming thanks to the steep increases in taxation and prices demanded by a “troika” of international creditors to address the country’s economic crisis.

In May 2011, the International Monetary Fund (IMF), the European Union (EU) and the European Central Bank (ECB) loaned Portugal the equivalent of 103 billion dollars as a financial rescue package.

In return, the troika imposed draconian conditions on middle- and lower-income sectors of the population, and headed by the IMF took on a supervisory role over this southern European country’s economy.

Sheer survival instinct among those most affected by the austerity measures is driving them further into the parallel economy, which according to recent official figures amounted to 24.8 percent of GDP in 2010.

And it is continuing to grow, owing to the severe economic crisis from which there seems to be no way out, a study from the Faculty of Economics of the University of Porto concludes. Continue reading

Nigerians in US and Occupy Movement protest Nigerian government’s removal of oil subsidy (2 articles)

Daily Trust (Abuja)

Nigerians in Atlanta Protest Subsidy Removal

Nasiru L. Abubakar

10 January 2012–Nigerians and friends of Nigeria, including leaders of the “Occupy Atlanta” movement, staged a protest against the removal of fuel subsidy and rising insecurity in Nigeria.

According to a post by one of the organizers of the event, Farooq Kperogi, the demonstrators will march to the Nigerian Consulate in Atlanta, United States and called on those living in the Atlanta to endeavor to attend.

A letter delivered to the Consulate General said following the removal of subsidy said “Nigerian mineral wealth should benefit Nigerians, not Shell Oil and other multinationals. The removal of this subsidy is clearly the design of the international Monetary Fund.”

Mr. Geoffrey Teneilabe, the Consul-General, said the protest can hold outside the premises of the Consulate General of Nigeria in Atlanta.

“While we negotiated where to protest, Baba Garba, Consul (Economic, Commerce, Education/Nigerians In Diaspora Organization), attempted to call the police on us. I think he just wanted to intimidate us. Of course, it didn’t work. We later protested outside,” Kperogi said.

“They wrote down my name and that of a leader of the Occupy Atlanta Movement called Taylor Morris, took pictures of us, and promised deliver our letter to the government in Nigeria.” Continue reading