Washington Post on A16

Brad De Long delong at econ.Berkeley.EDU
Wed Apr 19 20:08:09 PDT 2000

>Brad De Long wrote:
>> I'm a social democrat who believes that markets need to be managed
>> and controlled by democratically-based political institutions. So I'm
>> for a bigger, kinder, gentler IMF run by European social democrats.
> But does Larry Summers feel the same way?

The senior Treasury staff that I have talked to think--as they put it politely--that neither the congressional majority right nor my friends on the left are for an expanded IMF loaning more money for longer terms with less conditionality. Thus the kinder, gentler IMF I want to see is off the table, and not worth time thinking about: there's no political traction to possibly make it happen.

Thus the real choice is between the Armey-Nader position of no IMF and laissez-faire in international finance, the Summers position of an IMF that sticks to its core competence of crisis management and gets out of the long-term loan long-term economic management business (where the IMF is too understaffed to do a good job), and the status quo.

And the real puzzle is why the "left" is for the abolition of--imperfect--institutions of collective self-management responsible to democratically-elected governments, and is lining up on the side of Hayekian laissez-faire: that the flaws markets have always arise only because governments stick their noses into them.

Brad DeLong

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