Lacy MacAuley

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a home for my pen, projects, and passions

the G20’s bailout plans: still paying for white elephants

God no. According to news sources today, the G20 is seeking to continue its efforts to pour even more money into the diseased institutions that sunk us into a global economic crisis: the IMF and high-rolling mega-banks. Giving them more money to try to fix the global recession is like putting a drug dealer in charge of rehab.

Why is the G20 paying more money to white elephants, giant resource-wasters like the IMF and oversized banks? Image: Original 19th century Thai artwork, artist unknown.

Why is the G20 paying more money to white elephants, giant resource-wasters like the IMF and oversized banks? Image: Original 19th century Thai artwork, artist unknown.

 

The IMF and giant banks are white elephants – unproductive resource-wasters who demand more and more of the milk and honey from our toil.

On the Global Justice Media Project blog a few months ago, I helped the author Kimberley Killen lay out exactly why the IMF was a blight and that it should play no part in anyone’s so-called solutions to the global economic crisis. In the article “G20 funding for IMF is more bad medicine,” we laid out the main issue:

Abandoning emerging economies to the assistance of the International Monetary Fund (IMF) is like putting a drug dealer in charge of rehab. But G20 leaders meeting in April have promised the IMF another $1.1 trillion.

The problem is that, whatever development index you’re looking at, whether the human development index or measurements of plain old GDP growth, the IMF simply doesn’t help.

Studies show that the IMF has had a harmful effect not only on the people and environment of a country, but on countries’ economies. Harvard and New York University studies report that once a nation enters an IMF program, growth slows dramatically. One study found that countries under IMF programs grew at a rate of 2.04% while those not involved in IMF programs grew at a rate of 4.39%. Another study found that IMF participation had a direct negative impact on growth by producing a stigma which discourages private investors.

In these times of frugality, why would the government throw needed taxpayer dollars away on the IMF, a failing institution? This funding is just more of the same bad medicine that got us into the global economic crisis in the first place.

And giving banks more money is also more of the same. In the US, hundreds of billions of dollars were given to the very same banking bigwigs and Wall Street wackos who failed to notice an over $8 billion housing bubble. We’ve paid in blood, sweat, and tears, which will come from our generation and from our children and grandchildren, for these kings in their castles to keep on feasting. 

And the G20 wants only to keep on paying out of public coffers so that our governments can continue to pay for these white elephants. Why?

I believe, it’s because these white elephants are the friends and families and neighbors of the G20, and as everyone knows, elephants protect their own.

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Filed under: activism, global justice, international relations

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