[lbo-talk] Did the IMF really get religion?

[Politicus E.]

Hi.  Mainly, it's rubbish.  The case of Iceland illustrates the IMF
has simply has not "moved on since then."  A mission from the IMF,
headed by Mark Flanagan, visited Reykjavik recently to discuss the
first review under the USD 2.1 billions Stand-By Arrangement.
Flanagan noted that “[t]he first review discussions touched on a
number of subjects, including: the macroeconomic outlook; a
comprehensive and well sequenced plan to lift capital controls ..."

It is true that there is a faction of pro-capitalist economists (e.g.,
Rodrik, Johnson, Bhagwati, and Krugman) does support some kind of
capital controls.  There are differences of opinion regarding the form
of the capital controls among this faction.  Many, for example, will
support only controls on capital inflows.

But this faction continues to have very little political influence.
Perhaps Johnson's laugh is an affirmation of this, or an attempt to
avoid the issue.  I don't think the interviewer asked an unreasonable
question.

epoliticus