The serious people at The Center for American Progress published an argument today that the IMF needs to be reformed, but that Congress should pass IMF funding without any guarantees of reform. The argument is very serious (emphasis mine):
Opposition is coming from both sides of the political spectrum. There is the usual neo-con fearmongering that this money is a "giveaway"-more on why this is silly below. There are also progressives who argue, with reason, that the IMF should be less strict in its demands from poor countries because past IMF conditions on loans to developing economies often caused great pain and were ultimately unproductive. All sides are demanding greater transparency in the IMF's lending practices and governance.
Much room remains for improvement at the IMF, but we need to ante up. Congress should deliver the funds we've pledged, while also keeping up the pressure for reform.
The article goes on to list five reasons for passing IMF funding. None of these reasons explain how IMF loans, which the article admits have often caused "great pain" and been unproductive, will become productive in the future. Further, there is no explanation for how more pressure for reform can be applied to the IMF once the funding is passed. There is this quote though (emphasis mine):
2. We are going to pay one way or the other. Let's be serious. We aren't going to let Pakistan's economy collapse, or for that matter Hungary's, Romania's, or Guatemala's. The potential national security consequences of any of those countries failing are too dire, not to mention the ultimately higher economic costs to America. Better the IMF prop them up-as they have-than us shoulder an even higher burden in funds and hassle.
3. This is a chance to show leadership again. American economic leadership has taken a serious beating lately. The world blames us for this crisis. This is a chance to do the right thing when countries are in need and gain back some credibility as an economic leader. Let's not be the last country to pay what we pledged.
Get serious, huh? Serious, like telling people to drop their demands to change the IMF, but to keep up their pressure to reform the IMF? Serious, like telling people that IMF loans have often caused great pain and were unproductive but, in order to prevent pain, we should fund the IMF without any changes to it? Serious, like arguing that passing IMF funding will demonstrate American economic leadership, even though several new governments have arisen in South America largely in response to popular sentiment opposing the American-led economic policies of the IMF?
It is infuriating how many Washington policy analysts will, when their arguments have no real persuasive value and are overtly contradictory, simply resort to calling opponents of their policy "not serious." This is especially the case when three-dozen progressive members of the House of Representatives are holding up IMF funding until four specific reforms are instituted by the IMF. What those Progressives are doing is actually "serious," since they are backing up their calls for reform with specific demands and meaningful action. By contrast, saying that an institution is hurting people and needs to be reformed, but simultaneously declaring that we need to drop all demands for reform, is fundamentally unserious.