IMF Strategic Ideas: From the “Washington Consensus” to the “World Government”
3 April 2011 at the annual meeting of the IMF and the World Bank, IMF President and Executive Director Dominique Strauss-Kahn delivered a conceptual, one and a half hour speech, which had the effect of a bombshell.The listeners could have the impression that the IMF was seized by members of the Communist International who had risen from their graves so that their leader, against the background of the global crisis, could proclaim from the high tribune some revolutionary manifesto calling for “renouncing the old world” and building the world of a new, just, planned-regulated .
In particular, Dominique Strauss-Kahn said that before the crisis, everyone was confident that they understood how to manage economic systems. There was the Washington Consensus, which formulated quite specific rules of monetary and tax policy. “Consensus” tirelessly argued that economic growth directly depends on deregulation in the financial and economic sphere. However, in fact, it turned out that low inflation, high economic growth, too free and uncontrolled financial markets to anyone lead to a financial and economic disaster.
In connection with this important conclusion, the head of the IMF, not embarrassed by revolutionary pathos, stated: “The Washington consensus with its simplified economic ideas and recipes collapsed during the crisis of the world economy and was left behind.”
Such words do not just cut off the rumor, but sound somewhat comical, since the IMF is one of the main bastions of the ideology of the Washington Consensus and the main tool for imposing this ideology on the whole world. And it turns out that the head of the IMF spoke out against what the International Monetary Fund, now headed by him, has been serving for two long decades.
What they refuse
The Washington Consensus emerged in 1989 year as a list of economic policy rules for Latin American countries. It was formulated by an English economist, John Williamson. This document program showed the Latin American countries a clear path from their regulated by authoritarian regimes economies to a liberal financial-economic model of the Western type.
It dealt with the principles, which, according to Williamson, reflect the common position of the US administration, the main international financial organizations (IMF and World Bank), as well as leading American think tanks. Since the headquarters of all of these structures were located in Washington, the document written by Williamson was called the Washington Consensus.
This program document includes a set of 10 basic economic steps that any government needs to take to build a modern Western-type financial and economic system in the country. In particular, implement:
· Liberalization (deregulation) of the economy;
· Privatization of the public sector;
· Strengthen fiscal discipline (maintaining a minimum budget deficit by reducing social programs);
· Protection of property and rights of owners;
· Reduced restrictions on foreign direct investment;
· Free conversion of national currency;
· Liberalization of foreign trade (mainly due to lower rates of import duties);
· Liberalization of financial markets;
· Reduction of marginal tax rates;
· Reorganization of the structure of budget expenditures towards the priority of health care, education and infrastructure.
For two decades, the West in general, and the United States in particular, systematically and purposefully, by all possible means and means, imposed on the world these 10 basic principles of the “Washington Consensus”. However, 3 of April of this year, the head of the IMF, suddenly declared that these principles are unviable, erroneous and even harmful.
In other words, the International Monetary Fund unexpectedly came to the paradoxical conclusion that the long-term activity of their organization is erroneous and even dangerous for those to whom it is directed.
Facets of "insight"
After a sudden insight, the IMF, through the mouth of its head, stated that it was the countries' desire to achieve low budget deficits, rapid economic growth, a free, uncontrolled financial market and liberal taxes led to the global financial and economic crisis.
But the most striking thing is that the IMF unexpectedly began to consider the financial and economic world order practically from the standpoint of the left ideology.
From the point of view of Dominique Strauss-Kahn, to overcome the uncertainty of the post-crisis world, it is necessary to create new principles of economic and social policy both for the world community and for each individual state.
In particular, according to the head of the IMF, the Western world realized that "the financial sector needs serious surgical intervention in terms of regulation." The crisis, according to Strauss-Kahn, was the product of a culture of mindless risks, and this culture is still alive. “In constructing a new macroeconomic system for a new world, the pendulum will swing, at least a little, from the market to the state and from relatively simple things to more complex things.”
It is noteworthy that the IMF is now sure: the financial sector must be taxed in order to pass on to it that part of the costs that, due to its risky operations, fell on the budgets of states and, as a result, on the population.
Financial globalization, said Strauss-Kahn, exacerbated inequality, and this became one of the secret springs of the crisis. “Therefore, in the longer term, sustainable growth is associated with a more equitable distribution of income,” the head of the IMF announced. - We need globalization of a new kind, more equitable globalization, globalization with a human face. The benefits of economic growth should be widely distributed, and not simply appropriated by a handful of privileged people. ”
You can, of course, blame everything on the fact that the head of the IMF is a member of the French Socialist Party. Moreover, it is an extremely active member who has managed to create a separate section “Socialism and Judaism” within the framework of the party structure. However, it is extremely doubtful that at the annual meeting of the IMF and the World Bank, he spoke on behalf of the socialists.
Strauss-Kahn as an economist has always been a staunch liberal. That is why in 1997, as Minister of Economy, Finance and Industry, he implemented a program of financial and economic transformations in France, just within the framework of the principles of the “Washington Consensus”. Strauss-Kahn's socialist beliefs in no way prevented him from being an energetic proponent of economic liberalism. And the fact that he abruptly changed his position did not happen under the influence of his socialist views.
On the one hand, the revolutionary speech of Strauss-Kahn to a large extent laughed my vanity, because when I read it, I had an immodest, but pleasant feeling that almost all the theses of the head of the IMF about the modern economic and financial system of the West were borrowed from my book The path of evil. West: the matrix of global hegemony. There are also such coincidences.
What did you fight for?
But on the other hand, there was an unpleasant feeling that all of us again want to "throw."
First of all, it is completely incomprehensible why, if the 10 points of the “Washington Consensus” are erroneous, harmful and dangerous, the Ukrainian government could receive huge IMF loans only under the condition of strict observance of precisely these 10 program principles?
If, according to the head of the IMF, the Washington Consensus with its simplified economic ideas and recipes collapsed during the global economic crisis and was left behind, then why is its program still stubbornly imposed on Ukraine by the IMF? After all, it turns out that for Ukraine, the Washington Consensus is not the past, but the present and the future.
Where is the logic?
However, this is not important.
... And the heart will calm down
The Washington Consensus in practice proved its incapacity and destructiveness, the post-war world order collapsed and must be replaced by a new world order based on new principles. Everything seems to be correct and logical, but the alarming call for the distribution of wealth is alarming.
Here the question immediately arises: WHO WILL GET THE AUTHORITIES OF THE DISTRIBUTION OF BENEFITS ON THE SCALE OF THE WHOLE PLANET?
US government? IMF? UN? Or some new body that will personify globalization “with a human face”, observe the highest justice, control all the Earth’s resources, manage the global financial and economic system and redistribute the benefits that humanity creates at its discretion?
In this regard, I would not be surprised if Dominique Strauss-Kahn will soon deliver a long conceptual speech entitled “The Leading Role of the World Government in the New World Order”. This idea has long been in the Masonic minds of the ruling elite of the West (what I wrote in my book).
The fact that the principles of economic liberalism, the principles of the “Washington Consensus” are not just unfair and destructive, but represent the concept of a civilized mechanism for the expropriation of natural resources and material goods in favor of the West, have already understood even the weak-minded. In my opinion, this is not the problem. I think the problem is that from one extreme - the liberal system, seemingly deregulated, and in fact the transnational oligarchy under the control of the financial pool, we are all offered to move to the other extreme - a kind of planned global system governed by the “world government”, direct regulation of anything and everything. But this - "the same eggs, only a side view." Who will control this “world government”? Do not guess?
The global liberal economy, under the weight of accumulated system errors, hung and began to fall apart. In other words, the mechanism of expropriation by the West of the non-Western world was not childishly wedged. It is not difficult to understand that it cannot be modernized, since it has completely exhausted itself. We need a new, flawlessly working mechanism of global expropriation, disguised with abstract discourses on justice. In the context of the global crisis, such arguments from international finance capital sound quite reasonable.
It would be equally reasonable to say that only a totally planned and regulated financial and economic system, led by the “world government”, can be an alternative to totally deregulated liberalism. Those who created global liberalism and pushed the world into the deep abyss of the global financial and economic crisis dreamed and dream about this.
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