In 2010, the US agreed to a shift of $63 billion in IMF emergency funding to the Fund’s general accounts but Congress has been unable to pay for the pledge because of never-ending deadlock and grandstanding.
Republicans have blocked the spending because of fears it might not be paid back but the reality is far different than the rhetoric. Even the bankrupt banana republics in sub-saharan Africa pay back IMF debts.
In response to the US foot-dragging, member countries are threatening to remove the effective US veto at the Fund. A key Senate committee approved the funding yesterday along with a bill to support the Ukraine but it’s likely to be stripped out in Senate or House votes.
The US spends more than $1 trillion annually on the military and spy services and IMF loans are often far more influential and effective than threats of military force. Giving that up would be bizarre and another sign of the dysfunction in Washington.
