Imagine that you ran out of money, and all your friends were nearly bankrupt. Would you then go to the nearest outlet of HSBC or Citibank and demand to be made the branch manager, as you understand the need for an overdraft really, really well?
No, you would not. But this is roughly the argument EU leaders are now making about why another European should head the IMF after the Strauss-Kahn affair:
Angela Merkel insisted that given the IMF’s dominant role in helping eurozone states like Greece, Ireland, and Portugal deal with massive debt problems, it makes sense for Europe to retain the position. “About the question as to why a European, I would like to answer this by saying, of course, the emerging countries have a right to one of the top positions of either the IMF or the World Bank in the medium term,” Merkel said.
“But I think that in the current situation, when we have considerable problems with the euro, that the IMF is very heavily involved in this, which points to the fact that it is possible to put forward a European candidate and that we should promote this within the community of states.” Merkel said the fact that Strauss-Kahn had not served a full term also should be taken into account.
Asked if the EU could support someone from outside the bloc, a European Commission spokeswoman, Pia Ahrenkilde Hansen, said, “We believe we can identify a strong candidate in the midst of the EU.” And Ollie Rehn, European economic and monetary affairs commissioner, noted that knowledge of the European economy was one useful qualification for any candidate to succeed Strauss-Kahn.
Let us suppose that these arguments have merit. I assume that, as a quid pro quo, the EU’s leaders would accept that:
- As the majority of UN peacekeepers are in Africa, the head of UN peacekeeping operations should be an African (not, as a recent tradition dictates, from France).
- As the three biggest recipients of WFP food aid are Sudan, Pakistan and Ethiopia, the organization should be run by a troika of officials from those three countries.
- As the wettest place on earth is Cherrapunjee in north-east India, the World Meteorological Organization should be run by an Indian, not a Russian.
No European leader would accept these arguments (although the only one I’ve heard made seriously is the one about Africa and UN peacekeeping). Why do they imagine that the same logic should apply to the IMF?
PS: For a less bilious take on the issue, read this piece by Thorsten Benner.