Johns Hopkins University Professor Steve Hanke, an economist and expert on international monetary policy and currency markets, says the plug ought to be pulled on the International Monetary Fund, an institution that he says does more harm than good. "There's a great debate about what the appropriate scale and scope for the IMF should be," Hanke says. "My diagnosis is that they have meddled in domestic politics in potential or current client countries. They have also not alleviated poverty and generated prosperity and in fact have invited more crises as we've gone through the years."
"And it's time to pull the plug on that international bureaucracy and put them out of business," he says. "They're doing more harm than good, in short."
Hanke, who served on the staff of the Council of Economic Advisors in the Reagan administration, finds himself agreeing, at least in part, with protestors assembling in Washington who also want to shut down the IMF. But, Hanke says, where the IMF dismisses the protestors as not understanding the IMF's role and how it works, Hanke knows firsthand how the IMF operates.
In 1998, as an advisor to Indonesia, Hanke sat across the negotiating table from the IMF in trying to build an economic package that would rescue that country. "I know how these people operate," Hanke says.
Another subject of protest this week in Washingtion, the Jubilee 2000 debt forgiveness movement, prompts a strong reaction from Hanke, who believes it will be a bad mistake to forgive this debt, since he argues that it will not help the poor citizens of the debt-ridden countries.
"I don't think it's a good idea [to forgive the debt], because this money was loaned to countries that are corrupt, have very little economic freedom, little in the way of civil freedom, politically," he said. "The money has been used by those countries to, largely, go into defense expenditures, not the schools and hospitals drill. It's also, a lot of it, gone to cronies in the various countries. And much of it has directly into Swiss bank accounts held by the leaders of those countries."
Further, Hanke says that most of these countries have the assets and the liquidity to pay off these loans, but are simply unwilling to do so. "The point is, they can pay. They just won't pay." Professor Hanke is in Baltimore and available for interviews by calling 410-516- 7183. He would also be willing to travel to Washington for live interviews, time and circumstances permitting.
Broadcast-quality comments from Hanke in .wav and .rm formats can be found at: http://www.jhu.edu/news_info/news/home00/apr00/imf.html.
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