In These New Times

This is the complete text of the G20 summit declaration.

On the face of it,  there is nothing here to show that Webster Tarpley’s fears of a IMF dictatorship have been realized. Thus:

The IMF, given its universal membership and core macro-financial expertise, should, in close coordination with the FSF and others, take a leading role in drawing lessons from the current crisis, consistent with its mandate.

The IMF is usually mentioned along with other institutions:

Ensure that the IMF, World Bank and other MDBs have sufficient resources to continue playing their role in overcoming the crisis.

I see no evidence that it is to be given the teeth that Brown sought:

the role of the IMF in providing macro-financial policy advice would be strengthened.

“Advice”, by definition is not enforcible, unless we see it as having mob connotations, which, admittedly,  it could have.

We underscored that the Bretton Woods Institutions must be comprehensively reformed so that they can more adequately reflect changing economic weights in the world economy and be more responsive to future challenges. Emerging and developing economies should have greater voice and representation in these institutions.

But Strauss-Kahn and others insist that the IMF has already been reformed and is ready to go: seemingly not, according to the G20.

We stress the International Monetary Fund’s (IMF) important role in crisis response, welcome its new short-term liquidity facility, and urge the ongoing review of its instruments and facilities to ensure flexibility.

Rather than dictating it is to be subject to ongoing review.

We know the IMF is a bit strapped for cash: where are the readies up-front for its new short-term liquidity facility?

We should review the adequacy of the resources of the IMF, the World Bank Group and other multilateral development banks and stand ready to increase them where necessary.

But it is necessary in order to restore IMF power.

The Financial Stability Forum (FSF) must expand urgently to a broader membership of emerging economies, and other major standard setting bodies should promptly review their membership.

Another body, the FSF, is given a prominent role. Certainly, we need to look at the significance of this body.

Some clauses are clearly a shot across the bows of Washington and London:

National and regional authorities should implement national and international measures that protect the global financial system from uncooperative and non-transparent jurisdictions that pose risks of illicit financial activity.

This sounds like Angela Merkel’s bit about the Cayman Islands and Channel Islands.

Tax authorities, drawing upon the work of relevant bodies such as the Organization for Economic Cooperation and Development (OECD), should continue efforts to promote tax information exchange. Lack of transparency and a failure to exchange tax information should be vigorously addressed.

This looks like another reference to such tax havens.

National and regional authorities should also review business conduct rules to protect markets and investors, especially against market manipulation and fraud and strengthen their cross-border cooperation to protect the international financial system from illicit actors.  In case of misconduct, there should be an appropriate sanctions regime.

I wonder who these “illicit” actors could be? Are we talking about economic sanctions against Britain and the US.

This is a suitably nebulous document with the obligatory shibboleths and one or two interesting acronyms: however there is no basis for regarding it as restoring

” the IMF–which is the “iron fist” of the US Treasury– to its former glory so it can once again use its extortionist loans to thrust faltering nations into structural adjustment, privatization and slave wages”

as Mike Whitney has claimed.

Nor does Professor Chossudovsky’s claim that

“the hegemony of Wall Street remains unscathed. The tendency is towards a unipolar monetary system dominated by the United States and upheld by US military superiority. “

seem justified. One wouldn’t expect the Washington consensus to be dismantled overnight: it looks more like death by a thousand cuts. This summit hasn’t in itself resolved anything, but I would venture to suggest that the tendency is quite the opposite to that perceived by Professor Chossudovsky.

1.  We, the Leaders of the Group of Twenty, held an initial meeting in Washington on November 15, 2008, amid serious challenges to the world economy and financial markets.  We are determined to enhance our cooperation and work together to restore global growth and achieve needed reforms in the world’s financial systems. Read the rest of this entry »