Congressional funding for the International Monetary Fund, being pushed by the Clinton administration, is totally unjustified. Many members, especially Republicans, rightly believe that the austere policies the IMF demands in return for its multi-millions in loans to economically struggling countries do more harm than good.
Sharply raising taxes and interest rates and severely tightening the money supply, charge IMF critics like '96 presidential candidate Steve Forbes, would be bad medicine for an advanced industrial economy like the U.S., so how can such medicine possibly do any good for a developing economy? All IMF's harsh measures do is crush an already fragile economy, dash optimism and trigger political instability, like what is seen in Indonesia.
Whether the GOP-led Congress finally goes along with the latest IMF funding request or not, it ought certainly to at least pass legislation proposed by U.S. Rep. Ed Royce, R-Calif., exposing the hypocrisy of the IMF bureaucracy.
While high-salaried bureaucrats impose stiff taxes on entire nations, they don't pay any taxes themselves. The international agency reimburses its employees, including the Americans, for every nickel they pay in income taxes.
How easy it must be to boost taxes on others, when they don't have to pay any taxes themselves. They are also provided generous allowances for housing and their children's private schooling.
Talk about a great job. Royce's bill, however, would make it a little less great. He believes it's time for IMF bureaucrats to feel some of the pain they dish out to others. Perhaps then they will adopt policies that are a little less austere and more realistic.
Royce's legislation would direct the IMF to terminate the policy of reimbursing employees' taxes and also put an end to those other generous allowances. If only one piece of IMF legislation is passed this year, it ought to be Royce's.