Abolish the IMF

In: Uncategorized

23 May 2011

This is my latest comment from Fund Strategy.

It would be far better if the discussion of Dominique Strauss-Kahn’s legacy had focused on economics rather than sex. In the event it is grotesquely wrong on both counts.

To be clear, the sexual assault charges against Strauss-Kahn relate to what are essentially acts of ­violence. If they are true, it would mean he forced himself upon the victim in the case. Of course, the media always makes the token disclaimer that he is innocent until proven guilty.

But typically the coverage then goes on to imply that there is some kind of connection between the allegations against Strauss-Kahn and his reputation as a “seductor” (or “shagger” for those who prefer plain English). In this discussion there is little difference between the tabloids and the so-called quality media.

Such an approach blurs the line between acts of violence (which also happen to be criminal offences) and interactions between consenting adults. In doing so it underplays the ability of individuals to make informed choices about how they live their lives. By implication it also trivialises the act of rape.

Typically, the prurient coverage is followed by an acknowledgement that Strauss-Kahn, whatever his faults, did a good job in managing the global financial crisis. From this viewpoint the key question is who would be the best successor.

Here too the perspective is peculiar. The best that can be said about the International Monetary Fund (IMF) is that it helped to stabilise the global economy in late 2008.

Yet, more than two years later, there are no signs of the fundamental causes of the crisis being addressed.

The most recent edition of the IMF’s own World Economic Outlook shows that global economic imbalances only narrowed slightly in 2009 and 2010.

America has singularly failed to increase its production so that what it produces is more in line with the amount it consumes.

It therefore remains heavily dependent on credit from China and other exporting countries to finance its consumption.

In effect, the IMF, along with western governments, has simply stored up economic problems for the future rather than resolving them. Given its abysmal record, it would probably be best if the international organisation were abolished.