Tags: Exclusive Interviews | IMF | Lagarde | China | Republicans | Congress | quota reform

House GOP: IMF Reforms Will Stay 'Stuck' in Congress

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Tuesday, 14 October 2014 08:28 AM Current | Bio | Archive

Despite a spirited pitch last week from International Monetary Fund Managing Director Christine Lagarde for the U.S. Congress to enact reforms that would enhance the hand of China and developing nations in the IMF, Republican lawmakers left little doubt there was no way they were going to enact the controversial measures agreed to by President Obama.

Throughout the three-day IMF/World Bank meeting in Washington, D.C., Lagarde underscored the case for the reforms. She declared that "the under-representation of countries such as China and other emerging market is just not right. Not right!"

The IMF boss told the Financial Times that she will "keep pushing and pushing on this — I will belly dance if I have to, to get there."

"The 2010 governance and quota reform is an absolute must," Lagarde told reporters Thursday at the opening of the meeting, which was also the 70th anniversary of the founding of the IMF. "It has to be implemented and everybody knows that it is currently stuck before the U.S. Congress."

Under changes that President Obama and other world leaders agreed to in 2010, the IMF's equity capital would be doubled and 6 percentage points of the total would be shifted to emerging markets. In addition, the proposed reforms would move two of the IMF's 24 directorships from European to developing countries, including China.

"[The reform] was due in 2012, it was overdue in 2014, and I strongly hope that under President Obama’s leadership and with the right understanding of the parties, the role of the IMF warrants that ratification," Lagarde said.

But Republicans in Congress made clear to Newsmax their resentment at the president making such an agreement and their opposition to ratifying the reforms pushed by Lagarde so fervently.

"President Obama and Ms. Lagarde should understand that the president speaks for the executive branch alone," freshman Rep. Robert Pittenger, a North Carolina Republican, told Newsmax. "Through the president’s inept financial leadership, we have amassed an $18 trillion debt. Congress should take all measures to protect the American taxpayers from further obligations and also not empower, by ceding control, other countries that are often not in alignment with our interests.

"The president has a proclivity of deferring to other nations at the expense of the United States. We should not engage in further agreements that weaken our negotiating power with foreign nations."

Despite Lagarde’s vow to "keep pushing and pushing on this" with Congress, sophomore GOP Rep. Chuck Fleischmann of Tennessee told Newsmax, "I really don’t think much has changed in the Republican Conference on the IMF. To see the president attempt to relinquish some of our authority in an organization for which he continually asks Congress to increase funding just won’t fly."

Fleischmann said he would tell Lagarde that the IMF reforms are perceived by him and his Republican colleagues as akin to "the debtors trying to exert control over the bank instead of the creditors, and they will continue to be stalled in Congress."

"My first duty and responsibility is the constituents I have been elected to represent; the U.S. taxpayers," three-term Republican Rep. Bill Posey of Florida, a member of the House Banking and Financial Services Committee, told us. "I have to ask myself, why would I vote for a proposal that increases U.S. taxpayer exposure, has the potential to increase U.S. spending, while also reducing U.S. influence over how our contributions to the IMF are spent?

"That just doesn’t make common sense to me or my constituents."

John Gizzi is chief political columnist and White House correspondent for Newsmax.

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Republican lawmakers are clearly unmoved by Christine Lagarde's spirited pitch for the U.S. Congress to enact reforms to the International Monetary Fund that would enhance the hand of China and developing nations.
IMF, Lagarde, China, Republicans, Congress, quota reform
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2014-28-14
Tuesday, 14 October 2014 08:28 AM
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