Knock, Knock – “It’s the IMF …“

For years we have read reports about the International Monetary Fund telling Mexico, Argentina, Greece, Lithuania, Russia … whoever… to get their economic house in order. Invariably, these reports contained buzz-words like “unsustainable” and “belt-tightening.” Officials would explain that “current levels of social services” had to be slashed in order to produce something called “sustainable economic growth.” The IMF web page puts it this way:

“The International Monetary Fund (IMF) is an organization of 187 countries, working to foster global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty around the world.”

Simply put, the IMF is a big bank or, more precisely, a mega credit union which lends money to “creditworthy” countries. But like any bank, the IMF will not lend money unless it is assured it will get it back; and not only “back” but back at a given rate of return — i.e., with a profit. What this means is familiar to any home-buyer or borrower: in order to qualify for the loan one has to cut back on things that make life worth living and even on things necessary to living life.

With individuals this “loan qualification” standard is accompanied by a certain amount of obnoxious Puritanical hectoring. “Vacations” get equated with “sloth” and a balanced diet gets equated with “gluttony.” The borrower, if he wants the loan, must learn to live lean and work hard. After all, it's good for character.

Of course, the hectoring is a canard. What is really at issue is the “reproduction of labor” at an acceptable social level. The concept is simple. In order to “work hard” on Monday it is necessary to rest and recuperate on Sunday. The body must “restore” itself (from whence the word “restaurant”) and this requires food and sleep. The concept is also natural. Land in production must, at a certain point, lie fallow in order to regenerate itself so as to produce new yields. These basic truths provide the basis for the economic principle that a sustainable production of goods requires a reliable re-production of the ability to work.

While it is possible to come up with a minimum schedule of “inputs and outputs” most people would like to think that society is something more than a labor camp operating at “minimum cost” and “maximal efficiency.” In fact, mordern research has shown that true economic efficiency depends on human happiness. Because many industrial processes require more than mere repetitive motion, the ability of a laborer to replicate his work from one day to the next depends not only on calories but on clothing, shelter, medical care, educational opportunities and leisure time. It is the complexity of society itself that requires more complete and complex forms of regeneration.

While it is true that the lives of many people in the West can be described as fat and lazy this fact simply serves as an excuse for bankers. It would make absolutely no difference to them if the same monies spent on vacations were “spent” on retirement savings. The banker sees the borrower as a value generator — a hamster on a wheel — that needs to churn out a certain quantum of value to meet the lenders desired ROI. This avarice results in a primitive equation which thinks only of profit and conceives of profit as simply the inverse of costs. Ergo: “get your ratios down if you want to qualify”.

The same hectoring takes place between the IMF and borrower countries. The only difference is that what is put on a diet are a country's social services: child-care, education, health, retirement. As if they were self-indulgent luxuries, these social benefits are deprecated as living beyond one's means. Tsk. Tsk. If the country in question wants a “bail out” then it must put “cut backs” in place. It is typically left unsaid what these cutbacks entail in the flesh. But “living within one's means” invariably means old people eating cat food and shivering in the cold. It means infants deprived of formula or vaccinations. It means otherwise talented young people relegated to menial, part time service jobs. It means — and this is no exaggeration — toothpaste being too expensive for large segments of the population.

How is this possible? Doesn't the IMF itself say that its goal is to promote financial responsibility, high employment and sustainable economic growth while reducing poverty around the world? It is necessary pierce the razzle-dazzle. These catch-phrases mean something different to the IMF bankers than they mean to ordinary people.

“High employment” does not equate with high living standards. A labor camp has high employment. “Financial responsibility” means the type of tightened belt and ROI that has just been described, and “sustainable economic growth” does not refers to the economic enrichment of people but to the maintenance of an efficient generation of corporate profits. In the IMF manual, poverty gets “reduced” only via the tried and untrue mechanism of trickledown, as is more than evident in any country that has been the unlucky beneficiary of IMF “aid.” Poverty has been so reduced in Peru, that swarms of orphans roam the streets of Lima sniffing glue to kill the hunger pains.

It is no surprise that people around the world view the IMF with utter loathing. Even the illiterate among them understand that the IMF is a money lender who is going to take its cut out of their flesh. It is as age-old and as simple as that.

But not in the United States. If any people are suckers for Puritanical hectoring it is Americans. It makes us feel good. How many times in the past 25 to 50 years has one heard the racially-tinged, self-righteous disdain for “those” Mexicans or “those” Poles or “those” backward, third-world whoevers who need to get their “shtuff” together and learn to be more like us.

Ah… but what goes around comes around. The IMF has now come a-knocking and has advised the United States that its national debt levels are “unsustainable.” The US needs to get its house in order. Issuing its semi-annual, long-term economic assessment, the organization warned that the size of the US deficit risked creating instability in the financial markets. The IMF urged the United States to adopt measures that would allow it to meet its fiscal commitments. (BBC Report ; IMF Report [13 Apr 11].)

Not that this “assessment” was much of a surprise. Speaking in January to the “Plutocrati” assembled in Davos, Switzerland, Treasury Secretary Geithner protested that “There are some people who [would] like to move… very quickly to do very deep cuts in spending, but it is not the responsible way to do it.”

In the name of “economic recovery,” Geithner prefers making the cuts gradually over time. In other words, we can belt tighten slowly… so slowly that maybe Americans won't really notice the slow boil. By the time we live lives of ragged destitution, we will think it's natural and the way God ordained things.

But among the things that God ordained was prepositional phrases. Deciphering what is natural and what is expedient begins with good grammar. And so the question becomes: “Fiscal commitments to whom?” Answer: to those few who, as Franklin Roosevelt said, “seek to enrich and advance themselves at the expense of their fellow citizens.”

The High Priests at the IMF are Moloch's acolytes. Their “assessment” was simply a salvo in the financial propaganda war. Their buzz-words are designed to occlude a “system” the integral and ultimately sole purpose of which is to generate “sustainable income growth” for a few at the expense of many. They want us to produce greater yields with ever lesser costs of reproduction. They will plow the land till it yields nothing even for locusts.

We are all value-producers on a wheel; that is an inescapable fact of life, unless we are to return to the days of nut and berry plucking from the vine. The issue is not whether we reproduce in order to produce value but how that value is distributed among us.

©Woodchip Gazette, 2011