I

quote a comment posted by Eric of Jakarta (The Jakarta Post, May 30).

“And yes, austerity is a must right now because of countries’ huge public deficits,” Eric says in his response to an article about Dominique Strauss-Kahn of IMF.

Eric sounds like a housewife considering her budget for the next month. But a country’s economy is not meant to be run by microeconomists.

The IMF usually tries to force indebted countries to save themselves, to the great advantage of several multinationals. Nearly all of the Latin American countries have been through such an experience.

For years they got more and more indebted, until they kicked the IMF out, and suddenly they got back on track. This happened in Brazil and Argentina, and to a lesser degree in Chile and Uruguay.

During and after the financial crises of 1997/98, Indonesia accepted the IMF — with disastrous results. Only when President Susilo Bambang Yudhoyono changed Indonesia’s policies to get rid of the IMF, did Indonesia begin to move toward rectifying the problem.

Former Malaysian prime minister Mahathir Mohammad was clever enough right from the beginning not to let the IMF in. (This, by the way, was one of the reasons that lead to the rift between Mahathir and his deputy, Mr. Anwar Ibrahim, who wanted the IMF in.)

The furious reaction of the United States showed it all. They wanted the IMF to break open the financial markets of East Asia, and Mahathir didn’t play along, and successfully steered his country into quiet waters.

One of the worst examples of IMF policies is Bolivia, the Western Hemisphere’s poorest country. For a pathetic US$25-million loan, the IMF tried to force Bolivia to privatize its water resources and pass on the profitable business to the (infamous since the Iraq war) Halliburton company that almost immediately began doubling the price of drinking water.

Suddenly people who earned less than $50 a month had to pay $20 bills. When the IMF prohibited Bolivia’s government from subsidizing drinking water, so that the poor might have something to drink, protests erupted all over the country.

By the way, the United States and Great Britain, while profiting from the IMF’s policies, are more indebted than Greece or Spain or Portugal. Do you get it now, what’s going on?

Armin Wertz
Hamburg, Germany