Archive for May 27, 2008


May 27, 2008

Erle Frayne Argonza y Delago

Plans are now afoot at merging the World Bank and the IMF, the two economic pillars of the post-war alliance of nations to foster cooperation and development. They came straight out of the Breton Woods agreement, and were rightly called the ‘Breton Woods Agencies’ then.

The merger is among the responses of the technocratic-financier-political elites of the North to the crashing global economy. The ‘virtual economy’ based on financier speculation and worthless bubbles, or otherwise ‘casino economy’ of the wealthy, had burst so badly. The implosion of the financial system had seen the closure of big banks and the alarming loses of others most specially those that had enormous exposures to the subprime realty market in the USA.

The question is whether this merger is really the appropriate response to a system problem. Many experts and quarters the world over have been clamoring, since way back 1990s yet, for the convening of a ‘new Breton Woods’ and the institution of a new global financial architecture. I was among these experts on the Philippine side, and many of us are inside government as executives and legislators.

However, an IMF-World Bank merger is farthest from our mind. The IMF particularly has this notoriety for prescribing shock treatment on economies in crisis, particularly the developing countries or DCs, that do not at all mitigate the long term impact of structural problems. On the contrary, the austerity pills of the IMF were shown to have caused further contraction, depression, and deterioration of once thriving emerging markets.

Let’s face it, the IMF and World Bank are largely the institutional agents of the global financial cartels. They do not represent the true interest of sovereign nation states, do not exercise any accountability at all except to the financier sponsors behind the backs of the IMF-World Bank boards and leadership, and are instruments to encumber nations into perpetual debt peonage. The IMF-World Bank group represents the forces aimed at destroying sovereign nation-states and no less.

The North does not have a monopoly of wisdom in salving the ailments of the global economy, and so we peoples of the south  may just have to push for actions that would see how the catastrophic impact of the global economic implosion will be mitigated. Let the OECD propel their own oligarchs’ self-aggrandizing actions, while we patriots of the South move on to save our people, nations, environments and institutions from further predatory onslaughts by the greedy global oligarchs.

The IMF-World Bank merger is a hideous monstrosity. Be forewarned!

[Writ 26 May 2008, Quezon City, MetroManila]