We all want to be the Boss of the IMF

The Financial Times and many of the European papers are suggesting who would be the best new CEO of the International Monetary Fund (IMF).

Trump has suggested that his daughter would be great for the job, but she is already too busy selling clothes and advising her father and husband on how to manage the world, a job to which she has absolutely no experience – just like her father…

The fact the Ms. Lagarde got the job was just because she was politically from the right party and French. She is also a Neo-liberal who believes in a special version of austerity: 

  1. Ordinary workers should be paid less and get fewer benefits
  2. All governments that ask for IMF money should be squeezed except for France that should benefit generously from IMF handouts…
  3. Public services and natural monopolies should be “privatised” to French government owned companies
  4. French banks should receive unlimited financial support from the European Central Bank and taxpayers, no matter how badly managed. She also believes that she is above the law – Bernard Tapie, a former chairman of a big football club, is embroiled in a fight over a fraught 1993 corporate deal and the compensation he won from the state 15 years later. The case was already in the civil courts and led to a 2016 trial of Ms. Lagarde, then the French finance minister, for her role in the saga. She was convicted of negligence, but escaped fines or jail time! Nice work by her lawyers, unlike her predecessor Mr. Strauss-Kahn who “left” the IMF after being accused of raping a hotel worker…

What is interesting is that she has absolutely no experience of banking or central banking – the IMF is just a politically controlled fund that follows mainly American neo-liberal ideology.

The other named candidates are all right wing folk who have been little or no experience in development finance, business or banking with perhaps one exception, that of Agustín Carstens the former head of the Mexican central bank. Given Mexico’s deep economic and social problems, it could be argued that he has done little to solve these matters.

One candidate who has been jumping from one job to another is a former PM and finance minister from Finland. This gentleman is called Mr. Stubb – his best capacity is that of an iron man athlete which would probably put him in front of the other candidates if sports was the most important criteria for the job. 

He was famously enthusiastic about selling off our publicly owned electric transmission company to private investors who then increase prices by more than 40% in the ensuing years. The performance of private investors in such companies is great. They get to borrow huge sums and use the debt to pay out hug dividends to themselves for a job well done. Recent reports from the UK indicate that the water companies there (all privatised natural monopolies) managed to pay out some €56 billion in dividends while borrowing €51 billion to make investments! That is a great way to “tax” water buyers who have no choice but to pay twice as much as necessary without any improvement in service.

It is lovely to watch all these great candidates line up and try to fill their pockets with gold coins…

Long live transparency in public life!

Photo: Wikipedia Commons

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