The politics of monetary funds

Will Europe snub the IMF and set up its own “Monetary Fund”. Is this yet another “magic pill” that is supposed to solve the sort of problems seen with Greece recently?

The proposed EMF would function as a European equivalent to the IMF; a lender of last resort to financially troubled eurozone governments to ensure the stability of the euro and global markets. Under the direction of the other members of the eurozone, the EMF would dictate fiscal policy to the offending government in return for a bailout.

Its main benefit would be to free the eurozone of the ‘outside’ involvement of the IMF and thus maintain confidence in the ability of Europe to set its own house in order.

(Quoted from here)

I like this bit: “dictate fiscal policy”. The Greeks seem unwilling to accept their own government’s dictates on fiscal policy, so why they would accept anyone else’s is a puzzle.

“maintain confidence in the ability of Europe to set its own house in order” is also very good spin. Just look the language! maintain; confidence;order – all such positive buzzwords.

In fact, what will DEEP DOWN, LONG TERM maintain confidence is doing the right things that you can afford, not lending ever vaster sums and putting a slick gloss on the conditions. “Conditions”? There’s a laugh! There were “conditions” put on Greece’s entry to the EU in the first place. Unfortunately, only lip-service was ever paid to them. Why should anyone believe it will be different in the future?

The last thing we need is yet another vast, Euro-Quango. The IMF is there if required, even if it is a bit tainted through being “international” and a bit too American for some people’s taste. What advantage (apart from vainglory) is there in Europe having its OWN Fund? And LENDING ever more money isn’t the answer; doing the right things IS. For this, you don’t need an EMF.

And what happens when (or is it if?) we get a sustained “boom”? The EMF is still there, doing nothing, waiting for the next BUST. All its highly-paid officials will still be paid for years on end to do nothing – another vast bureaucracy sucking our taxes up like some great cosmic, vacuum cleaner.

Still, if it does come to pass, think of all the extra taxpayer-funded jobs and power that will accrue to Brussels!   Thanks a bundle Greece. Thanks to your humungous over-spending, corruption and general lack of the right stuff we are ALL likely to be lumbered with yet another expensive European cash-gobbling monster institution round our necks.

By Chris Snuggs