Stiglitz' loose talk again

Doug Henwood dhenwood at
Thu Jul 2 09:29:44 PDT 1998

Jordan Hayes wrote:

>To hear Stanley Fischer tell it in the Jul/Aug Foreign Affairs,
>the IMF was watching closely since about 1/96 in Thailand and
>could have pulled the trigger at any time, but allowed it to unwind
>in the way it did because of fears of the problems with a pre-emptive
>strike. Bart Simpson says you're damned if you do and you're
>damned if you don't.

Hey, let's get rid of that French socialist Camdessus at the IMF and replace him with Bart!

>Do you think it's somehow wrong for the IMF to stand behind at least
>the idea of Russia trying to fix its problems? Do you think that it
>is somehow outside of its charter? Or I forget: do you think the
>very notion of having an IMF at all is somehow distasteful? I mean,
>of course, other that the normal objection to the whole ball of wax.
>Finally: it's clear (to me at least :-) that Russia is doomed without
>some kind of external support. They may well be doomed anyway, but
>what is to be done? I think I've heard two things from you on
>this point: it's too easy to get IMF support, so countries have
>no incentive to avoid the kind of 'crisis' that leads to a 'bailout'
>and can go on being sloppy; and the IMF is like a Macarthur beach
>landing and the internal medling that comes along with the
>wing-tipped thugs is like an invasion. Should it be harder to
>get help or easier?

The IMF doesn't help countries, it helps foreign creditors and industrialists and their junior partners in the client countries. So, yeah, I'm all for helping the Russians out of the mess they're in - especially since it was U.S. (and European) "experts" who helped them get into the mess in the first place. Russian "experts" took the neoclassical economic theory the read literally, and not as the exquisite mathematical fetish-object it really is, and their politicians have been selling off Russian assets to foreigners for a mere 20%, um, commission.


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