Let us not be blinkered by haste and the Euro-zone crisis

The resignation of DSK is a sad, even tragic ending, to an IMF leader who did manage to begin to pry open the institution.  New ideas were bubbling up, or maybe bubbling in.  All was not well in terms of transparency, awareness of the impact of policies on the poor or the environment–whether before policies were required or after the fact.  The distribution of power among countries remains highly skewed in favor of status quo powers, with little space for the myriad small and  poor to speak or better to influence the institution.  But, like the G20, the IMF Board has elevated the emerging major economic powers–all without the need for another world war.

But now our focus must be on the leadership process that is inclusive, transparent and merit based.  The IMF and World Boards prepared a long-ignored joint document on how to execute such a process.  The IMF Board alone on July 12, 2007 issued its own clear roadmap on how to conduct such a selection process, which was again ignored.

The drama and speed of the leadership change this time cannot be used as another excuse to revert to old ways.  The Executive Board must exercise the power that is theirs and conduct a merit-based search.  Europe does not need to be excluded, but it cannot act as the presumptive heirs to a throne.  And the problems of the euro and of European debt are not a basis for any selection preference–No Latin American or African was chosen when their regions were in crisis; nor an Asian during the Asian crisis. There are many women and men who are well qualified for this position.  Let the search begin.

2 thoughts on “Let us not be blinkered by haste and the Euro-zone crisis

  1. And, by the way, though I like a good wine, a good meal and a good hotel, if I was the Chairman of the International Monetary Fund, often responsible for imposing harsh conditions on people, I would never ever accept staying at a $3.000 dollar a night suite, and so, what I would ask of whomever is selected, is to have a better common sense and of the proportions.


  2. I would go one step further… unless the European does not carry some very special qualifications as an independent free thinker a European should be excluded at this particular time because of the presence of the conflict of interest that can reduce the effectiveness and credibility of IMF’s interventions in Europe. Though I do not suggest it, in the case they absolutely refuse to give up what they think is their right to nominate, I would even go as far as to tell them to temporarily swap that unjustified right with the US’s equally unjustified right to nominate chairman at the World Bank.

    On top of that, what the world needs the most, is to be able to break free from the dumb regulatory concoctions produced by the mainly European Basel Committee, and which odiously discriminate against the “risky” unrated small businesses and entrepreneurs who have never ever been the source of a major bank crisis, and in favor of those perceived as not risky and who, besides cases of fraud, have caused all bank crisis in history.


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