Keep those US loan commitments
Supporters fo America's commitments to regional development loans are making a last-ditch effort to keep those commitments this week. They themselves deserve support as they try to prevent the House from voting cuts in US funding for the Inter-American Development Bank (IDB) and the Asian Development Bank. The Senate had approved the funding at the level expected when US negotiators obtained such international concessions as reducing the share of US contributions to the inter-American bank from 40 percent to 34.5 percent.
The effect of the bank rules is that its activities cannot go forward until the US share has been subscribed. So the effort to get an acceptable bill after long delay has to be applauded. And the cuts that have come out of a Senate-House conference committee are less than the ones originally sought in the House. But their passage would plainly undermine US credibility in future negotiations.
Every million dollars does have to be watched in the interest of budget restraint. But most of the commitment is for back-up funds, not cash expenditures. Even with full funding, the 1981 budget outlays for the IDB have been estimated at only $7 million, which itself has to be seen as offset by what comes back to the US for services and goods bought by other countries with the help of the loans.
The administration had worked for the full funding promised by its negotiators. But now, alas, it appears to have caved in one accepting the cuts as the price of passage, with hopes of restoring funds later. This makes it all the more important for Americans concerned with the US maintaining its multilateral responsibilities to rally around those trying to forestall an unfortunate precedent: congressional refusal -- for the first time -- to authorize loan funds at their promised levels.