Anyone who doubted that the IMF is in deep trouble over its inane involvement in the toxic Greek bailout, and Berlin’s policy of extending Greece’s insolvency ad infinitum while the country’s social economy shrinks, should now have no more doubts. Congressman Bill Huizenga (R-MI), a senior member of the House Financial Services Committee, yesterday introduced the IMF Reform and Integrity Act, which would require the U.S. to oppose the International Monetary Fund’s (IMF) co-financing of a third Greek bailout with the European Stability Mechanism. If such co-financing were to go forward, the bill would prohibit the U.S. from supporting an IMF quota increase until funds are repaid in full.“The IMF is supposed to be a lender of last resort, not a fig leaf of first resort for Eurozone members,” said Congressman Huizenga. “The IMF isn’t a fund to rescue political parties in creditor nations, nor should it be a junior partner to outside organizations that lack the commitment to do their work. For seven years now, the IMF has been used to shield Eurozone officials from their voters, which has tarnished the Fund’s reputation, prolonged Greece’s misery, and put off hard choices about Europe’s future that must be made regardless. As the IMF’s largest shareholder, the U.S. should ensure that the Fund remains independent and free from politicization that could put taxpayer dollars at risk. This bill will help make that a reality.”
In addition, the IMF Reform and Integrity Act cancels supplementary IMF funds that have already been deactivated, rescinding them and sending those resources back to the U.S. Treasury. The bill also clarifies existing law to require the U.S. Executive Director of the Fund to oppose any loan to a country whose debt is unsustainable. Text of the legislation is available here.