The International Monetary Fund (IMF) meetings that brought her to İstanbul were much about how best to pump up the flow of capital through the credit-starved world economies. It is, however, in what some might describe as the fringes of this macro-economic dialogue that the elephant is allowed to roam about the room. The most obvious consequence of a world recession is that poor people get poorer and that opportunities for new generations recede. The figure cited by the charity Oxfam is that 100 people are pushed into poverty every minute, bringing the world total past 1 billion.So the obvious message that should have emerged from the busy consultations this past week is that finance ministers and international financiers should not be taking measures that will make a bad situation worse. While this might seem common sense, it is not something one can take for granted. While the developed world recommends free-spending Keynesian policies for itself, it has in the past recommended belt-tightening, Friedmanite balanced budgets for poor nations and the developing world. What an organization like the IMF says matters. It is the gatekeeper of flows of capital around the world, the ultimate rating agency. As much as hard cash, it provides approval so emerging economies can borrow on the open market and poorer countries who can't borrow can at least attract aid.
For goodness sake, let's not kick the worst off when they are down, is Ms. Johnson's message, by which she means that the IMF should not be insisting that nations cut back on health and education and other poverty reduction programs -- and G8 nations should not be cutting back on aid. She comes armed with the data on the ground that investing in poor people is a good way of stimulating the economy. “They make the right choices,” she says and use money from discretionary cash transfer schemes to put more food on the table and keep their children in school. Direct assistance should take priority over spending on things like infrastructure.
Indeed, if one wants to see the effects of this sort of immiseration, then one has only to look at the Southeast of Turkey where the population has been the long-standing victim of not so much an economic crisis but political unrest. Domestic violence, high rates of child mortality and the mass psychosis that derives from men denied the dignity of work are classic symptoms of a society denied the prospect of hope for a decent life. They are not the results of some atavistic, tribal culture.
The issue is getting the IMF to take on these insights “upstream” at the policy stage and to get the IMF to begin designing “structural adjustments with a human face.” It means taking on board social concerns in a systematic and informed way. Certainly there is some evidence that İstanbul was a very different sort of summit from the meeting the previous year when the great priority of the richer nations was saving their skins. This time the message has sunk in, that the boom years in the West were financed by those who could afford it least, the rural and urban poor. The IMF cannot get away with imposing conditionalities which themselves lack a sense of social justice.
“The IMF is about to change,” Ms. Johnson says with guarded optimism. But of course this means a change in culture among a set of professionals not noted for their humility. The current leadership of the IMF got the message. Let's hope the leopard can change its spots. A headline in the Milliyet newspaper got it about right. İstanbul was the occasion for “capitalism to confess its sins.” So now the question is whether those who trust in the inexorable wisdom of the markets will not go out to reoffend.
Benzer Haberler 
