IMF--what a lovely organization (NOT) part xxxx

Once did a thought experiment--what would happen if some hacker managed to cancel some country's external debt?

I am pretty sure that if Keynes could come back from the dead and see what the banksters have done with his humanitarian IMF idea, his heart would fail again.

IMF Computer System Hit by Foreign Cyber-Attack

By Michael Riley and Sandrine Rastello - Jun 12, 2011 11:01 PM CT

The data theft from International Monetary Fund computers by hackers said to be linked to a foreign government follows incidents against companies and governments that illustrate the growth of cyber-attacks as an espionage tool.

The IMF hack resulted in the loss of a “large quantity” of data, including documents and e-mails, according to a person familiar with the incident, a security expert who declined to be identified because he wasn’t authorized to speak on the subject. This year, the Group of 20 and Oak Ridge National Laboratory have also come under cyber-attack.

The person said the intrusion was state-based, without saying which government is thought to be behind it. The Washington-based IMF approved a record $91.7 billion in emergency loans last year and provides a third of bailout packages in Europe.

“The value of what’s being lost in these cyber-attacks is increasing at a very fast rate,” Sami Saydjari, the founder of Cyber Defense Agency in Wisconsin Rapids, Wisconsin, said in an interview this year before the latest attacks. “There are two perpetrators that are most concerning. One is organized crime, the other is nation-states, and they are both quite serious.” more

IMF and World Bank: Global Loan Sharks and the Media

Media Beat, Feb. 9, 1994

By Jeff Cohen and Norman Solomon

We rarely hear about them in the major news media -- and when we do, we get mostly fluff and flackery.

According to the media image, they function tirelessly to encourage "reforms" so that backward countries can get their economic houses in order.

Who are they? The International Monetary Fund and the World Bank -- the two most powerful financial institutions on earth.

From Russia and Thailand to Bolivia and Chile, the IMF and the World Bank provide loans -- and constant advice. Well-heeled economists from affluent countries routinely offer billions of dollars, if the needy nations prove willing to make certain changes in policies.

Serving as a conduit for money from Western governments and banks and bondholders (with the United States as the biggest single source of funds), the IMF and World Bank require that recipient nations adhere to strict "structural adjustment" programs. They include easing limits on foreign investment, increasing exports, suppressing wages, cutting social services such as health care and education, and keeping the state out of potentially profitable endeavors.

"The World Bank and the IMF don't just have direct control over tens of billions of dollars per year," points out researcher Kevin Danaher of the Global Exchange organization based in San Francisco. "They also indirectly control much more from the commercial banks by functioning as a good housekeeping seal of approval. Offending governments who won't follow IMF/World Bank prescriptions get cut off from international lending -- no matter how well those governments may be serving their own people."

In Africa, Asia and Latin America, the pattern has been grim: To get grants and loans, governments agree to devalue currencies and cut subsidies -- thus raising the prices of necessities like food -- while freezing wages and reducing public employment. Scores of countries are struggling to pay the interest on old loans and qualify for new ones.

The spiral has brought deepening poverty and debt. "From the onset of the debt crisis in 1982, until 1990, debtor countries paid creditors in the North $6,500 million [$6.5 billion] per month in interest alone," reports the British magazine New Scientist. "Yet in 1991 those countries were 61 percent more indebted than they were in 1982." more

IMF Financial Terrorism

Stephen Lendman, Contributing Writer

Saturday, June 11, 2011

In July 1944, the IMF and Bank for Reconstruction and Development (now the World Bank) were established to integrate developing nations into the Global North-dominated world economy in ways other than initially mandated.

Under a new post-war monetary system, the IMF was created to stabilize exchange rates linked to the dollar and bridge temporary payment imbalances. The World Bank was to provide credit to war-torn developing countries. Both bodies, in fact, proved hugely exploitive, using debt entrapment to transfer public wealth to Western bankers and other corporate predators.

On a grander scale today, the scheme destructively obligates indebted nations to take new loans to service old ones, assuring rising indebtedness and structural adjustment harshness, including:

-- privatization of state enterprises, many sold for a fraction of their real worth;

-- mass layoffs;

-- deregulation;

-- deep social spending cuts;

-- wage freezes or cuts;

-- unrestricted free market access for western corporations;

-- corporate-friendly tax cuts;

-- tax increases for working households;

-- crushing trade unionism; and

-- harsh repression against opposition to a system incompatible with social democracy, civil and human rights.

As a result, bankers and other corporate predators strip mine countries of their material wealth and resources, shift them from public to private hands, crush democratic values, hollow out nations into backwaters, destroy middle class societies, and turn workers into serfs if they manage to have any means of employment.

In other words, perpetual debt bondage substitutes for freedom. A race to the bottom follows. An elite few benefit at the expense of the many, entrapped nations henceforth forced to pay homage to their money masters, effectively handing over their sovereignty.

As a result, neoliberalism is neo-Malthusianism writ large, destroying humanity to save it. Its holy trinity, in fact, mandates no public sphere, unrestrained corporate empowerment, and eliminating social spending to devote all state resources for bottom line profits, national security and internal control. more

What this means.

Trichet Threatens Greece with Iron Heel

Europe's New Road to Serfdom

By MICHAEL HUDSON   June 3 / 5, 2011

Soon after the Socialist Party won Greece’s national elections in autumn 2009, it became apparent that the government’s finances were in a shambles. In May 2010, French President Nicolas Sarkozy took the lead in rounding up €120bn ($180 billion) from European governments to subsidize Greece’s unprogressive tax system that had led its government into debt – which Wall Street banks had helped conceal with Enron-style accounting.

The tax system operated as a siphon collecting revenue to pay the German and French banks that were buying government bonds (at rising interest-risk premiums). The bankers are now moving to make this role formal, an official condition for rolling over Greek bonds as they come due, and extend maturities on the short-term financial string that Greece is now operating under. Existing bondholders are to reap a windfall if this plan succeeds. Moody’s lowered Greece’s credit rating to junk status on June 1 (to Caa1, down from B1, which was already pretty low), estimating a 50/50 likelihood of default. The downgrade serves to tighten the screws yet further on the Greek government. Regardless of what European officials do, Moody’s noted, “The increased likelihood that Greece’s supporters (the IMF, ECB and the EU Commission, together known as the “Troika”) will, at some point in the future, require the participation of private creditors in a debt restructuring as a precondition for funding support.”

The conditionality for the new “reformed” loan package is that Greece must initiate a class war by raising its taxes, lowering its social spending – and even private-sector pensions – and sell off public land, tourist sites, islands, ports, water and sewer facilities. This will raise the cost of living and doing business, eroding the nation’s already limited export competitiveness. The bankers sanctimoniously depict this as a “rescue” of Greek finances.

What really were rescued a year ago, in May 2010, were the French banks that held €31 billion of Greek bonds, German banks with €23 billion, and other foreign investors. The problem was how to get the Greeks to go along. Newly elected Prime Minister George Papandreou’s Socialists seemed able to deliver their constituency along similar lines to what neoliberal Social Democrat and Labor parties throughout Europe had followed –privatizing basic infrastructure and pledging future revenue to pay the bankers. more

It's Not Only Strauss-Kahn Who Should Be on Trial. It's the IMF Itself.

Johann Hari   06/ 3/11 

Columnist, the London Independent

Sometimes, the most revealing aspect of the shrieking babble of the 24/7 news agenda is the silence. Often the most important facts are hiding beneath the noise, unmentioned and undiscussed. So the fact that Dominique Strauss-Kahn, the former head of the International Monetary Fund (IMF), is facing trial for allegedly raping a maid in a New York hotel room is -- rightly -- big news. But imagine a prominent figure was charged not with raping a maid, but starving her to death, along with her children, her parents, and thousands of other people. That is what the IMF has done to innocent people in the recent past. That is what it will do again, unless we transform it beyond all recognition. But that is left in the silence.

To understand this story, you have to reel back to the birth of the IMF. In 1944, the countries that were poised to win the Second World War gathered in a hotel in rural New Hampshire to divvy up the spoils. With a few honorable exceptions, like the great British economist John Maynard Keynes, the negotiators were determined to do one thing. They wanted to build a global financial system that ensured the money and resources of the planet were forever hoovered towards them. They set up a series of institutions designed for that purpose -- and so the IMF was delivered into the world.

The IMF's official job sounds simple and attractive. It is supposedly there to ensure poor countries don't fall into debt, and if they do, to lift them out with loans and economic expertise. It is presented as the poor world's best friend and guardian. But beyond the rhetoric, the IMF was designed to be dominated by a handful of rich countries -- and, more specifically, by their bankers and financial speculators. The IMF works in their interests, every step of the way. more

Politicians 'Are Lying Through Their Teeth' on Greek Aid

06/10/2011 

Germany is prepared to help Greece, but only if private creditors are involved in any new bailout plan. The European Central Bank, however, remains opposed to any kind of debt restructuring. German commentators say the ECB, having bought billions in Greek bonds, is too deeply involved to be independent.

The European Central Bank may not think much of the German government's plans to save Greece from its debt crisis, but at least German Finance Minister Wolfgang Schäuble has found support at home. On Friday, the German parliament, the Bundestag, voted in favor of a motion that clears the way for more aid for Athens.

The motion was proposed by the coalition parties -- the conservative Christian Democratic Union, its Bavarian sister party the Christian Social Union and the business-friendly Free Democratic Party -- and ties support for a new bailout to certain conditions. Those include the involvement of private creditors in a new rescue effort and greater privatization and austerity efforts on the part of the Greeks. The non-binding motion is designed to provide Berlin with guidelines for upcoming negotiations with Germany's European partners over a new bailout package for Greece.

It is unclear, however, if Berlin will be able to push through its plan to make private creditors share the pain, something that the European Central Bank is resisting. On Thursday, ECB President Jean-Claude Trichet said he opposed any involvement of the private sector that was not "purely voluntary." But on Friday his deputy Vitor Constancio said there might be room for compromise, explaining that Trichet was keen to avoid any approach that would trigger a so-called "credit event," which would have serious consequences for investors. Some observers argue that the ECB is opposed to a restructuring because it itself now holds so much Greek debt.

'Serious Consequences'

In a government statement on Friday morning ahead of the vote, Finance Minister Schäuble warned of the consequences of a Greek default. "The situation in Greece, and hence in Europe, is serious," he said. He insisted on the importance of securing the next round of aid payments for Greece, worth €12 billion ($17.4 billion), which is due at the start of July. "If this tranche is not paid out, there is an acute danger of a Greek insolvency, with serious consequences for the stability of the whole euro zone," he said.

That tranche is in jeopardy, however. The report on Greece's progress prepared by the "troika" of the European Commission, European Central Bank and International Monetary Fund, which was obtained by SPIEGEL ONLINE earlier this week, revealed that a Greek insolvency within the coming 12 months could not be ruled out. That means that the IMF is unable to transfer its share of the next tranche of aid to Greece, making a new EU bailout necessary if Greece is to avoid default.

On Friday, Schäuble also repeated his proposal, made in a letter sent to Germany's euro-zone partners earlier this week, that creditor banks swap old Greek government bonds for new ones with maturities that are seven years longer. more