As Walden Bello writes of many of the international financial institutions:
were bad for developing economies; short-selling, or speculating on the
movement of borrowed stocks, was a legitimate market operation; and
derivatives — or securities that allow betting on the movements of an
underlying asset — "perfected" the market. The implicit recommendation
of their inaction was that the best way to regulate the market was to
leave it to market players, who had developed sophisticated but
allegedly reliable models of "risk assessment."
In addition to encouraging some of the policies that contributed to the economic crisis, IMF conditions on loans to many developing countries have had devastating impacts on poor and working people. For example, ILRF did this report that explains how loans from the IMF to Cote d'Ivoire required the country to adopt policies that lowered labor standards and increased child labor in the cocoa industry. The International Trade Union Confederation (ITUC) also just released a new report about how the policies of multinational corporations as well as the IMF have contributed to the global food crisis as well as lower working and living standards for agricultural workers globally.
Just last week, the IMF announced some changes in its conditionality policies on loans, the changes are only a small step in the right direction.
So, while changes in representation and the power structure at the IMF are important, there is an
urgent need to change the actual policies of the IMF. It is crucial that the G-20 seriously examine the proposals put forth by the ITUC as a starting point for designing an economic recovery that supports workers globally. The Decent Work, Decent Life campaign put out a similar list of recommendations. They articulated the challenge very well by stating, "The crisis must provide the trigger for a
wholesale reform of the global economic order. As such it could be a turning
point for the goal of achieving sustainable development and social justice. The
central objectives of a new economic architecture should be shared prosperity
with decent jobs and income for all." Meanwhile, 35,000 people marched over the weekend in London to call on the G-20 to create a global economy "based on fair distribution of wealth, decent jobs for all and a low carbon future." Will the G-20 be putting people first this week?
