by justin o’connell
The International Monetary Fund has a storied history restructuring national economies throughout the world in the midst of economic crisis or at the tail-end of a war. Typically associated with IMF or World Bank loans are the following,
Cutting expenditures, also known as austerity
Focusing economic output on direct export and resource extraction
Devaluation of currencies,
Trade liberalization or lifting import and export restrictions,
Increasing the stability of investment (by supplementing foreign direct investment with the opening of domestic stock markets.
Balancing budgets and not overspending,
Removing price controls and state subsidies
Privatization or divestiture of all or part of state-owned enterprises,
Enhancing the rights of foreign investors vis-a-vis national laws,
Improving governance and fighting corruption
These conditions have also been sometimes labeled as the Washington Consensus.
The International Monetary Fund represents a transnational public institution involving 187 member countries which, like all major public banking institutions thought up by our brotherly financial elite, work to facilitate global monetary cooperation (read: uniformity), secure financial stability (controlled markets), and to reduce poverty around the world (read: reduce people). The organization was dreamed up in 1944 with an eye towards stabilizing exchange rate and to help reconstruct the world’s international payment system. Countries would contribute to a fund that they could borrow from on a temporary basis.
Now, it is likely that countries like Italy and Spain will, in the end, turn to the IMF for rescue loans, and it will be in the interest of North American banking establishment and the U.S. Government to achieve in peripheral European countries terms similar to those implemented in the lesser developed countries over the span of the second half of the twentieth century. Therefore, either on the quiet or spread out over time, these loans will be made as each country goes down one-by-one.
Of course, there will be blowback from such policies from a population that does not wish to bailout anymore foreign entities, as took place during the 2008 $30+ trillion dollar bailout episode brought on the American people at the point of a gun. Well-known, trillions of dollars went not only to U.S. Banks and corporations, but also to multi-national banks, such as Deutsche Bank, etc. It is not in the interest of the ruling class to allow Europe to disintegrate. Now is as good a time as any to consolidate power and create close economic interdependence between not only European nations,but also nations across the Atlantic, such as United States, and therethrough Canada and Mexico.
In Spain politicized economic policies—such as the green polices which have hampered job growth—have arrested any prospects of that country emerging from its depression. Such obvious prospects automatically imply that the United States will be on the hook for further loans to Europe, and, in the process, suffer losses on funds they have extended to the IMF. The United States is not being leaned on at this point because of its economic superiority. Instead, it has become a lender of last resort.
These loans will make Europe a colony of the United States, just as it was post-World War II. But, once these loans go unpaid to the United States, which they will, how then will the United States fund its global empire? The answer is that it will not. A new global system will have to take place of the current United States dominated Western Civilization model. As many have pointed out, BRIC countries very well could take over center stage on the world stage.
The undeveloped nations whom the IMF have helped over the past half-century or so have had smaller economies than those of developed Europe. Many analysts understand the International Monetary Fund cannot be expected to help an entire developed continent weather a depression. The International Monetary Fund was designed for temporary loans to individual companies. It does not have the economic power to raise the globe from depression and infighting. A larger institutions will be made necessary, causing single institutions to begin issuing new currencies that do not have the negative implications as do the contemporary units of exchange—i.e. The Euro and the Dollar.
Funds earmarked for Spain and Italy would certainly exceed those loans already approved for Greece, Ireland and Portugal in deals engineered with the European Union. The popular BRIC nations—the theorized heir apparents of the global economy—have also expressed concerns over risks to the IMF’s capital.
The European Union summit ended on Friday with an agreement to draft a new treaty for more complete integration in the euro zone so as to obviate the debt crisis that experts and pundits claim started in Greece two years ago, although the true source of the depression lies elsewhere.
In the U.S., four lawmakers who had met with IMF chief Christine Lagarde last week felt uneasy about the fund taking on a bigger role in Europe.
Simultaneously, Republican lawmakers are making moves to nix a $108 billion loan the United States approved for the IMF in 2009, a move that would undermine Washington’s ability to influence conditions of the IMF loans.
Who will step into fund these countries as they go bankrupt one-by-one? It very well could be that the Bank of International Settlements could begin making direct loans to European nations on behalf of the central banking network. When this happens, expect the terms of these loans to appear more draconian than those terms associated with the World Bank and the International Monetary Fund.
What we will then see are stricter guidelines for all nations of the world when it comes to economic affairs. This standardization will homogenize specific national economic behavior, thus standardizing the people. Then it will be easier to, under the guise of contrived crises, a new world economic order.