IMF Admits Its Failings
The International Monetary Fund has admitted that there is no evidence its programs of the last 60 years have worked. An IMF report, released on March 19, concluded, “There is as yet no clear and robust empirical proof” that IMF policies strengthen the economies of countries where they are imposed.
The report admitted that the financial integration the IMF enforces often leads to “increased vulnerability to crises.” These crises come about when international investors withdraw funds at the first sign of trouble or engage in currency speculation. These crises have “exacted a serious toll.”
Kenneth Rogoff, the IMF's chief economist and co-author of the report, called its findings “sobering.”
According to a United Nations report released last year, the biggest recipients of IMF aid are poorer now than they were when the IMF was founded in 1944. In the last few years, Thailand, Indonesia, Korea, Russia and Argentina have received IMF loans in exchange for opening their economies to international capital flows and imposing government austerity programs. All experienced economic crises. Activists in Bolivia in February blamed an IMF-required tax increase for rioting that led to at least 20 deaths.
IMF policies have been widely criticized for these policies by activists such as John Cavanagh and Walden Bello, as well as by Joseph Stiglitz, former chief economist for the World Bank, the IMF's sister institution.
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