FROM THE OFFICE OF
Representative Richard K. Armey
Texas, 26th District
Communication Center | Home Page
NEWS RELEASE
Reforming International Financial Institutions
WASHINGTON, Mar. 8—
House Majority Leader Dick Armey made the following comments at a press conference today in which the final report of the International Financial Institution Advisory Commission was presented to congressional leaders:
I want to extend my very deep appreciation to Chairman Allan
Meltzer, Jeffrey Sachs and the other members of the commission. It's not easy to get a group of economists to agree on anything, much less major reform of our international financial institutions. But they have done it.
To their credit, they have achieved a broad consensus that will serve to guide us as we consider these matters this year.
This report will help reverse years of IMF mission creep. Ever since the IMF's original purpose vanished along with the old Bretton Woods system, the IMF, like any bureaucracy, has been casting about for a new role. Naturally, it found several-and not all of them were good.
But if we implement the commission's recommendations, we will turn the IMF around. No longer will the IMF offer overly ambitious schemes to redesign entire economies. No longer will it impose Herbert Hoover-style austerity plans on countries in trouble. And no longer will the IMF bail out the bankrupt on the backs of the poor.
Instead, the IMF will serve a much more restrained but effective role as what economists call a quasi-lender of last resort. It will focus on offering short-term assistance to countries to ease financial panics and crises. It will be there to stop trouble, not make trouble.
The commission has also highlighted a scandalous level of
mismanagement at the World Bank. For years, the Bank has been doling out money for poverty reduction without verifying that the money actually reduced poverty. The world's poor-not to mention the world's taxpayers-deserve better than that. The commission has a plan to clean up the Bank, and all who care about alleviating world poverty need to have a good look at it.
I believe this report will form the bipartisan basis for legislative action this year. This leadership cares deeply about preserving the health of the international economy. Like expanded trade with China -- which we strongly favor -- and like free trade generally, IMF reform will make the world economy stronger and help ensure that America's prosperity endures. As we expand trade and the relations between nations, it is more important than ever that the IMF serve a constructive role, rather than the destabilizing one it often has in the past.
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