While all eyes were on the rantings of Mahmoud Ahmadinejad at
the United Nations, the United States -- under President Obama -- was
surrendering its economic sovereignty at the G-20 summit.
The result of this conclave, which France's president Nicolas
Sarkozy hailed as "revolutionary," was that all the nations agreed to
coordinate their economic policies and programs and to submit them to the
International Monetary Fund (IMF) for comment and approval. While the G-20
nations and the IMF are, for now, only going to use "moral suasion" on those
nations found not to be in compliance, talk of sanctions looms on the
horizon.
While the specific policies to which the U.S. committed itself
(reducing the deficit and strengthening regulatory oversight of financial
institutions) are laudable in themselves, the process and the precedent are
frightening.
We are to subject our most basic national economic policies to
the review of a group of nations that includes autocratic Russia, China and
Saudi Arabia. Even though our gross domestic product is three times bigger
than the second-largest economy (Japan) and equal to that of 13 of the G-20
nations combined, we are to sit politely by with our one vote and submit to
the global consensus. Europe has five votes (Britain, France, Germany, Italy
and the EU), while we have but one.
And the process will be administered by the IMF, whose counsel
to less-developed nations over the past two decades has consistently called
for social pain and economic austerity. The IMF's misguided policies have
been responsible for more revolutions than Marx, Engels, and Lenin combined.
Its bureaucrats' arrogance is legendary, and its search for appropriate
punishments to fit the crime of spending too much on the poor smacks of
colonialism and imperialism. They are our new overseers.
This combination of the IMF and the G-20 will not only work to
structure national economic policies but to limit executive compensation at
financial institutions. The watchful, wise leaders of such nations as
Turkey, Saudi Arabia and Indonesia -- among others -- will monitor Wall
Street to assure themselves that their compensation is not out of line. One
particularly looks forward to the views of the Saudi monarchy on this
question of excessive personal enrichment.