IMF's Critics on Hill Step Up Opposition
... Try, Try Again
Once a bill runs into trouble on Capitol Hill, time is seldom on its side.
Take the measure to boost funding for the International Monetary Fund (IMF), which is now starring on the international stage in the role of lead lender to financially strapped Asian nations.
The funding, once part of a larger package of spending for foreign operations, first stalled last fall - just as the full scope of the economic troubles in East Asia was becoming clearer. The sticking point that time was an unrelated amendment to the bill concerning international funding of abortion.
Now, President Clinton is gearing up to do battle over the issue again. But opponents and interest groups have had months to mobilize against any future bill - and, as often happens, they now see even more problems than they did before.
There's much at stake. Not only would the president ask for $3.5 billion for a new IMF loan account, but he would also pay about $1 billion to the United Nations to cover the overdue US share of peacekeeping costs.
While the abortion controversy remains unresolved, critics are also unhappy over the IMF's handling of the economic crisis in East Asia.
As a result, IMF opponents on the left and the right have vowed to block further money for the organization - including a new $14.5 billion request to cover the American share of an increase in IMF funds - unless stringent conditions are attached.
The critics, ranging from socialist Rep. Bernard Sanders (Ind.) of Vermont to flat-tax GOP presidential prospect Steve Forbes, say it lets big banks off the hook while imposing hardships on working people and ignoring political repression.
"The American people are going to be very skeptical of any plan to bail out international speculators and repressive regimes that simply encourages them to repeat the same pattern of abuse and excess," says Rep. David Bonior of Michigan, the No. 2 Democrat in the House. "We must use our leverage with other countries in the international marketplace to improve wages, working conditions, and democratic rights."
IMF opponents also say the bailout distorts free-market operations. "The crisis ... has been caused and exacerbated by the absence of a free market," says Peter Krug, aide to Rep. Cliff Stearns (R) of Florida. "These Asian economies have been forcibly insulated from the free market through quasi-protectionist practices, managed economic models, official corruption, and cronyism."
AFL-CIO President John Sweeney warns that the IMF bailout will lead to a flood of cheap imports into the US from the beset Asian countries, while US exports to those countries drop. "Both the increase in imports and the decrease in exports will cost American jobs and lower living standards," he charges.
BUT the funding is important to the White House, which is championing it more aggressively. Secretary of State Madeleine Albright last week accused congressional opponents of "blackmail" in holding the IMF and UN hostage to other issues. The IMF plays a "central role in efforts to end the financial crisis in East Asia," she said. "The fact that we are so far behind in our payments to [the IMF and the UN] hurts America. It makes it harder for them to carry out programs that serve our interests."
Even if the IMF issues are resolved, disagreements over abortion remain. That controversy erupted when a group of House GOP conservatives tried to reinstate a Reagan-era policy prohibiting US aid to international organizations that perform or promote abortion. Mr. Clinton threw out that regulation when he took office in 1993. If the president requests the IMF and UN money through a supplemental spending bill this spring, House conservatives say they may try link the abortion issue again.