Who Needs the French? Or, For That Matter, the IMF?
Last week, you'll recall, French finance minister Christine Lagarde announced her candidacy to replace her countryman Dominique Strauss-Kahn, now modeling ankle bracelets in Manhattan, as chairman of the International Monetary Fund.
After spending a few moments looking at the performance of the French economy, I have a question. Why on earth would any member of the IMF vote for her?
Take a look at this chart, assembled from World Bank data, comparing economic growth over the last half century in France (the red line), the United States (dark grey), China (light grey), Brazil (mustard), and India (light blue). Over the entire period, French economic growth has proven only middling--and over the last decade growth in France has fallen far behind that in China, India, and Brazil.
If the IMF truly wishes to devote itself to fostering economic growth, then it needs to look for a chairman someplace other than France. Because the only argument for Christine Lagarde is this one: That the IMF sees its purpose not as fostering global growth but as propping up the increasingly implausible dream of a United Europe, of, by, and for European technocrats, by bailing out Greece, Ireland, and, soon enough, Spain.
A vote for Christine Lagarde, in other words, represents not a vote for global growth but a vote for the care and feeding of the European technocracy.
Come to think of it, I suppose she'll win in a landslide.
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Comments:
Mar '11
Re: Who Needs the French? Or, For That Matter, the IMF?
Peter, it could be worse - Gordon Brown has been trying for the job, after wrecking the UK economy.
Or Mr Obama may have some spare time after 2012, in between writing his next autobiographies.
Or Tim Geithner, although he may have trouble using TurboTax for the more complex filing of US Tax returns from France.
But, yes, it will more likely be another European Technocrat, such as the German ex-head of their Atomic Energy Authority.
Sep '10
Re: Who Needs the French? Or, For That Matter, the IMF?
I used to think a single currency could produce more free trade and that it would be a good thing but they've managed to create more bureaucracy as well. Its really just a question of how it comes unglued. On one side of the world we have the bankrupt welfate state model and on the other we have what I think and hope will become a bankrupt model of "state capitalism" to borrow Ian Bremmer's phrase. It sure seems like it will outlast the euro though.
Aug '10
Re: Who Needs the French? Or, For That Matter, the IMF?
That's where I'd put my money, if I was a betting man.
May '10
Re: Who Needs the French? Or, For That Matter, the IMF?
When was the last time that France was a serious nation? 1940?
May '11
Re: Who Needs the French? Or, For That Matter, the IMF?
"France has never got over the fact that they were once a great nation, but are now just a great nuisance."
-Thomas Sowell (I think)
Re: Who Needs the French? Or, For That Matter, the IMF?
The year was 1704 -- when, after 150 years of victory on the field of the sword, the French lost the battle of Blenheim to John Churchill, soon to be duke of Marlborough, ancestor of Winston. The French -- and I mean this literally -- have been on the defensive every since. There was, of course, Napoleon, but he was Louis XIV wannabe.
May '10
Re: Who Needs the French? Or, For That Matter, the IMF?
Paul A. Rahe
The year was 1704 -- when, after 150 years of victory on the field of the sword, the French lost the battle of Blenheim to John Churchill, soon to be duke of Marlborough, ancestor of Winston. The French -- and I mean this literally -- have been on the defensive every since. There was, of course, Napoleon, but he was Louis XIV wannabe. · Jun 1 at 3:56pm
Thanks, Dr, Rahe. Now the question becomes, why, then, has France enjoyed the status of world power since? Was it its colonial possessions, or its cultural achievements, or its central European location? Why didn't it assume the status of say, a Greece, or a Finland, or Poland, just to name some names? Did it piggyback on the Allied victories of WWI and WWII to remain on the "A" list of nations?
Lastly, is France's importance and influence among nations fading, along with the rest of western Europe?
May '10
Re: Who Needs the French? Or, For That Matter, the IMF?
Kervinlee
Now the question becomes, why, then, has France enjoyed the status of world power since?
Well, France was still legitimately a power after 1704, even as it was gradually being eclipsed by Britain as the strongest imperial power and by Prussia/Germany as the eminent continental power. And regardless of his numerous flaws, Napoleon did successfully dominate most of Europe before eventually, in his hubris, overreaching.
It's really only been since WWII that France has been granted more credit as a power than is merited. This was by British designs, mostly for reasons of European realpolitik. The US did not widely support this policy, but wanted a similar unmerited status granted to China as an up-and-coming power. At Casablanca the US effectively traded support, and unmerited recognition as a world power, to the French under Charles de Gaulle in return for a similar British support and recognition to China under Chiang Kai-shek. This certainly proved one of the bigger diplomatic blunders of the war.
Re: Who Needs the French? Or, For That Matter, the IMF?
While I'm certainly sympathetic to the first question in the title, I think the second one needs to be brought out a lot more in our national dialogue. The United States constitutes roughly 17 percent of IMF funds. Why do we do this? I have trouble providing a strong defense. I think this is a very strong GOP campaigning point when arguing against an Obama foreign policy characterized by its internationalism.
May '10
Re: Who Needs the French? Or, For That Matter, the IMF?
Kofola
Kervinlee
Now the question becomes, why, then, has France enjoyed the status of world power since?
Well, France was still legitimately a power after 1704, even as it was gradually being eclipsed by Britain as the strongest imperial power and by Prussia/Germany as the eminent continental power. And regardless of his numerous flaws, Napoleon did successfully dominate most of Europe before eventually, in his hubris, overreaching.
It's really only been since WWII that France has been granted more credit as a power than is merited. This was by British designs, mostly for reasons of European realpolitik. The US did not widely support this policy, but wanted a similar unmerited status granted to China as an up-and-coming power. At Casablanca the US effectively traded support, and unmerited recognition as a world power, to the French under Charles de Gaulle in return for a similar British support and recognition to China under Chiang Kai-shek. This certainly proved one of the bigger diplomatic blunders of the war. · Jun 1 at 6:00pm
Sounds right. Thanks, Kofola.
Re: Who Needs the French? Or, For That Matter, the IMF?
Harry, you think clearly and write beautifully. When will you be transferring to Dartmouth?
Re: Who Needs the French? Or, For That Matter, the IMF?
I feel Rob Long may have some bones to pick here...
May '10
Re: Who Needs the French? Or, For That Matter, the IMF?
I think it's mostly out of tradition, given that the United States effectively founded and monetarily spearheaded the IMF and the other large international organizations (UN, World Bank) in the first place to serve as the backbone of the new international order FDR hoped to establish after the Second World War. There are also some people who would argue that these organizations have a role in maintaining a relatively stable world economic order (not something I particularly agree with). Additionally, one might argue that by footing such significant portion of the bill we're afforded a certain degree of influence within them (debatable, even if more reasonable).
Essentially, they represent the international equivalent to the domestic 'too big to fail' argument.
Jun '10
Re: Who Needs the French? Or, For That Matter, the IMF?
I'm in a music posting mood. So here's Edith Piaf singing Non, Je ne regrette rien. It's the musical Galic shrug par excellence!
Mar '11
Re: Who Needs the French? Or, For That Matter, the IMF?
Peter: Completely agree on the IMF chairmanship going to another technocratic Frenchman. Ugh.
Harry: You ask an important question about US involvement, but your question suggests others: what is the alternative? Should the GOP proffer a foreign policy where we extricate the United States from the IMF? What would the consequences be? What alternative model of development does the US now propose?
As Kofola pointed out, the IMF is part of the Bretton Woods system created primarily by our diplomacy after WWII. The reason the US historically has provided so much of its funding is that, frankly, we were the only one's in a position to do it. Today, we provide less than the EU (combined).
I think there are very legitimate critiques of the way the IMF has handled development. Especially in the last decade, I highly doubt it has been a good steward of global finance. It has exacerbated corruption in sundry countries.
Even still: Obama's administration has not radically altered the way the US interacts with these institutions from the way we have for the last 60 or so years. If the GOP would, we must confront the questions I raised above seriously.
Re: Who Needs the French? Or, For That Matter, the IMF?
I think this comes down to the basic "leaky bucket" theory that as a governing body grows, its efficiency decreases. Looking at the Bush Administration's fantastic work in Africa, I feel the GOP can easily make the case that our foreign aid can much be better spent 1) by us, and 2) on our own projects.
Furthermore, I don't see why there is not a greater moral outrage that we are bailing out Europe than there is for our own bailout. This is an easy political point for the GOP.
Moreover, there is a secondary issue here on how much the United States spends on international aid. I am not of the school of thought that we should necessarily scale this back by a large amount, but I do think it best if it's in our control.