Supplemental passes with strings attached to IMF funding
After delaying it for a week of arm-twisting and head-counting, the House leadership brought the $106 billion spending bill for the wars in Iraq and Afghanistan up for a vote Tuesday. Previously, 51 anti-war Democrats voted against the bill, but by the time the final vote was taken, that number dwindled to 32. Apparently it was easier for some to vote against the war-funding measure when their votes were meaningless.
Speaker Nancy Pelosi needed those votes for passage, as House Republicans voted against the measure because it included $5 billion to extend the International Monetary Fund’s line of credit by $100 billion. In the end, however, five Republicans voted in favor of the bill, making the final tally 226-202.
The Treasury Department, which is the real power behind the IMF, thought it could slip IMF funding through by attaching it to a supplemental spending bill destined for quick approval. Going through the back door would also thwart any substantive debate about the IMF’s policies, which have been a disaster for the poor since the early 1980s. The maneuver surprised IMF critics, who were able to find a champion at the last moment in Sen. Sherrod Brown (D-OH). Brown managed to gain approval for an amendment on IMF funding to exempt health, education and nutrition from IMF-imposed budget caps (check out Brown’s speech on the Senate floor).
According to RESULTS Legislative Director John Fawcett, the Brown amendment was retained in the House-Senate conference report. The big disappointment, though, was that other IMF reforms did not make it into the final bill. These provisions were sought by 41 House members who signed on to a letter initiated by Rep. Maxine Waters (D-CA). There were four concerns voiced in the letter:
Use the Stimulus Money for Stimulus, not Contraction. In conference, we urge inclusion of language to ensure that the funds allocated by Congress for global stimulus are used for stimulatory, and not contractionary, purposes.
Resources for Low-Income Countries. In conference, we urge inclusion of language requiring the U.S. Executive Director to the IMF to ensure that some of the revenue from the planned gold sales and/or other sources of income will be used to provide at least $5 billion in non-debt-creating assistance to the world’s poorest countries – either via debt relief or grants.
Democratic Process. In conference, we urge inclusion of bill language requiring the U.S. Executive Director to the IMF to ensure parliamentary approval of all IMF loans. This would help to ensure greater democratic participation and transparency, as well as a safeguard against corruption.
Transparency. In conference, we urge inclusion of language to ensure greater transparency and public availability of documents within a reasonable time period.
While anti-poverty advocates did not get all the reforms they sought, the Brown amendment is an important first step toward reining in the IMF’s harmful policies. For the provision to make any difference, however, requires cooperation from Treasury to have the U.S. director at the IMF oppose any loans that don’t exempt health, education and other safety nets from budget caps. Congress will need to keep an eye on Treasury to make sure it complies with the spirit and letter of the law. I’m betting there are several advocacy groups willing to help out with that oversight.