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The International Monetary Fund

Introduction

The International Monetary Fund and the World Bank were created in 1944 at a conference in Bretton Woods, New Hampshire, and are now based in Washington, DC. The IMF was originally designed to promote international economic cooperation and provide its member countries with short term loans so they could trade with other countries (achieve balance of payments).

Since the debt crisis of the 1980's, the IMF has assumed the role of bailing out countries during financial crises (caused in large part by currency speculation in the global casino economy) with emergency loan packages tied to certain conditions, often referred to as structural adjustment policies (SAPs).

The IMF now acts like a global loan shark, exerting enormous leverage over the economies of more than 60 countries. These countries have to follow the IMF's policies to get loans, international assistance, and even debt relief. Thus, the IMF decides how much debtor countries can spend on education, health care, and environmental protection. The IMF is one of the most powerful institutions on Earth – yet few know how it works.

1. The IMF has created an immoral system of modern day colonialism that SAPs the poor.
2. The IMF serves wealthy countries and Wall Street.
3. The IMF is imposing a fundamentally flawed development model.
4. The IMF is a secretive institution with no accountability.
5. IMF policies promote corporate welfare.
6. The IMF hurts workers.
7. The IMF's policies hurt women the most.
8. IMF Policies hurt the environment.
9. The IMF bails out rich bankers, creating a moral hazard and greater instability in the global economy.
10. IMF bailouts deepen, rather then solve, economic crisis.

– Top Ten Reasons to Oppose the IMF from Global Exchange, 01 April 2005.

The effects of the IMF

Structural adjustment – the standard IMF/World Bank policy package which calls for slashing government spending, privatization, and opening up countries to exploitative foreign investment, among other measures – has deepened poverty around the world. In the two regions with the most structural adjustment experience, per capita income has stagnated (Latin America) or plummeted (Africa). Structural adjustment has also contributed to the rising inequality of income and wealth in the developing world.

– IMF Structural Adjustment Programs: The globalization of poverty.

For how much longer should we give those who run the global economy the benefit of the doubt? The International Monetary Fund has made the same "mistake" so many times that only one explanation appears to remain: it is engineering disaster.

The crises over which it has presided in Thailand, South Korea, Russia and Argentina are well-documented by Joseph Stiglitz, the former chief economist of the World Bank, among others. But we have, until now, lacked a comprehensive description of the way it worked in eastern Europe. A new book by the economist Pongrac Nagy shows for the first time how the IMF smashed Hungary.

– Poisoned chalice by George Monbiot, 19 August 2003.

For about a decade, Nicaragua's health care budget has been steadily declining under IMF structural adjustment programs that impose a cap on social spending . From 1996 to 2003, amidst such neoliberal encroachments, Nicaragua saw its supply of doctors per 10,000 people decrease from 6 to 3.8 . Insufficient health funds have not only thwarted doctor availability, but provision of basic medical supplies, repairs for dilapidated hospitals, subsidies for essential medicines, and other prerequisites for functional health care.

– Swindling the Sick by Ben Beachy, 30 January 2006.

Better off without the IMF

In 1995, the IMF and the World Bank stopped loaning money to Belarus, citing the country's refusal to implement free market reforms.

The strategy to financially isolate Belarus backfired. Not only did Belarus avert financial and social crisis, its economy flourished. Since 1996, the economy has gone through a steady period of expansion averaging an annual growth of 6.6 percent.

This growth persisted while the rest of the former Soviet republics experienced economic decline. In 2003, Belarus's rate of economic growth was 7 percent. It increased to a staggering 11 percent in 2004.

Social and health indicators demonstrate that Belarus's economic growth has translated into impressive gains in the people's standard of living. Belarus has the lowest poverty level in the region: 2 percent, compared, for example, to 11.5 percent in Latvia and 31.4 percent in Ukraine.

– U.S. government orchestrates anti-Lukashenko opposition by Mazda Majidi, 01 May 2006.