The IMF, World Bank and the WTO
Robert J. Riley INTRODUCTION The United States has much at stake in the architecture of the international economic system and the effectiveness of its primary organisations, including the International Monetary Fund. These stakes are not just economic in nature; they have very important military and political dimensions as well. American economic conditions and relations with the rest of the world influence its strategic, geopolitical decisions; the causality also goes in the opposite direction, so any discussion of economic policy should not take place in a vacuum, divorced from a broader conversation about security and political stability. As such, we cannot separate, say, our trade ties with Europe from the geopolitical alliance with our European allies. Concerned with these relationships are standards of living, domestic security and the ability to preserve our social values, all of which enter the calculus. Genuine general equilibrium thinking is needed, but is often missing from the very heated debate around narrower – albeit important – issues, such as the role of the IMF in stabilising foreign exchange rates. In the end, the proper place and duties of the IMF and the other international organisations in the world economy depend critically, of course, on what we construe their objectives to be, as well as on our perception of the constraints they face in the global political, economic, and cultural environment. A frank assessment of these goals and parameters is thus part of the broader discussion. The nature of regional and bilateral agreements, domestic politics, and military alliances (among...
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