NationStates Jolt Archive

(Very rough draft, more like scribbles...)
International Monetary Fund
Category: Free Trade
Strength: Strong

UNDERSTANDING the occurences of fiscal crises among member states,

GUIDED by the principles set forth by UN Resolution #77, Good Samaritan Laws,

The UN urges the creation of IMF, in which the national cash reserves of any UN member state may be voluntarily placed and exchanged for IMF credits. IMF credits are floated against a myriad of stable currencies (or currencies that have a long history of being stable) among UN member states.

Voting rights depending on the amount of monetary reserve placed by each UN member. More reserves placed by a member state, more voting power given to the member state. A committee composed of an odd-numbered UN member states will be formed through a vote. The committee will then, through voting, decide what currencies to float IMF credits against, among other things. Each committee member will have only 1 vote for IMF policies.

The funds can be lend to any applying UN member whose economy is in fiscal crisis, provided the committee agrees, and the borrower agrees to reform their economy and/or lower government spending to enable them to pay back the loan.
It is a form of loan cooperative among nations. Barring a severe global economic downturn, it can help individual nations through loans in case of national crises, or even just through better management of national reserves of wealthy nations.

"Voting rights depending on the amount of monetary reserve placed by each UN member. More reserves placed by a member state, more voting power given to the member state."

This would mean even more power too the already powerfull and rich nations of the world - and would undermine the capacities of less fortunate nations to pursue alternative economical policies. These nations would be at the mercy of the rich - "The funds can be lend to any applying UN member whose economy is in fiscal crisis, provided the committee agrees, and the borrower agrees to reform their economy and/or lower government spending to enable them to pay back the loan." - A nation in economic distress could be forced to cut back on exactly those goverment activities needed to create long term economic growth - education, healthcare or infrastructure to name a few.

Looking back at the 20th century it seems to me that succesfull recovery from economical depressions is connected with more goverment spending and not less - as shown by both Germany and the US in the 30´s for example.

The Delegation of the Republic of Capitalist Progression whole heartedly supports this UN proposal.

We feel it is a good way to stabilize the economies of UN member nations, and also benefit’s the global economy as well.

However, the Delegation of the RCP also would like to see an addition to the IMF proposal - low cost loans for developing nations, as well as insurance for high risk investment in those nations as well.

And who is going to decide which are the correct economic reforms? If you think about the horrible track record of the real IMF, you'll see why I have a problem with this. The IMFpretty much caused a complete breakdown in law and order in Indonesia when they told the government to lose the food subsidies. Their economic "reforms" have never once worked (think Argentina, Russia, etc.) and have in many cases made things worse. Are you sure you want to create a body like this? Are you sure you want to create a body of the wealthy to wield power over the poor?