IMF is seen as this uber platform for pushing capitalism and free markets down its member’s throats. The even mention of the letter S (for Socialism) and C (for controls) in the corridors of Bretton Woods institution is enough to land one in trouble. Though, post crisis, IMF has accepted C (as in capital controls) in a real change of heart.
However, if one thinks of IMF’s role in crisis it is just the opposite. It usually wants a super strong government/technocratic team to push its ideas despite strong opposition from the public. This is actually not democratic capitalism which IMF wants to be seen as pushing but abject socialism. In socialism only we have seen super strong governments just pushing things at people’s throats irrespective of public opinion.
The same is happening in Europe as well. Ryan Mcmaken of Mises quotes from an article in NYT:
The International Monetary Fund (dominated by the US which has the largest voting bloc, by far) has demanded Europe be more socialistic. The New York Times reports:
The three options laid out by the I.M.F. would have different operations, but they share an important feature: They involve other European countries giving Greece money without expecting to get it back. These transfers would be additional to the approximately 86 billion euros in new loans contemplated in Monday’s deal.
“Wait a minute,” you might say. “The I.M.F. isn’t calling for a fiscal union; it’s calling for debt relief.” But once a debt relief program becomes big enough, this becomes a distinction without a difference; they’re both about other eurozone countries giving Greece money.
Indeed, one of the debt relief options proposed by the I.M.F. is “explicit annual transfers to the Greek budget,” that is, direct payments from other governments to Greece, which it could use to make its debt payments. This, obviously, is a fiscal union.
The article mentions only a “fiscal union” between European states, but a fiscal union is just one tiny baby step from a political union. If tax money is seamlessly spread around Europe with little regard for national distinctions or borders, at some point, we just have to admit we’re dealing with just one huge state. And that, of course is that the IMF and European elites want — a huge mega-state that can force bailouts, austerity, and taxpayer largesse anywhere inside its borders.
If the Greek default experience helps illustrate why decentralization (i.e., separate nation states) no longer works in Europe, then that’s all to the good, in their minds, and will only accelerate the drive toward one centralized political authority that can direct fiscal, monetary, and regulatory policy across all of europe without having to deal with pesky local referenda or national opposition.
As likes of Chomsky say – whatever is the general narrative on governments and these international bodies, opposite is usually the truth. IMF is a classic example of such ironies…