Class War Abroad, Class War at Home
Why does the International Monetary Fund exist? Well, if you go to their overview page on their website, you will find reasoning like this:
The IMF promotes international monetary cooperation and exchange rate stability, facilitates the balanced growth of international trade, and provides resources to help members in balance of payments difficulties or to assist with poverty reduction.
In practice, in Ukraine specifically, the IMF isn’t assisting with poverty reduction; it’s assisting with America’s new Cold War against Russia. Here is Michael Hudson, one of my favorite economists, in a piece posted at Counterpunch yesterday:
In April 2014, fresh from riots in Maidan Square and the February 22 coup, and less than a month before the May 2 massacre in Odessa, the IMF approved a $17 billion loan program to Ukraine’s junta. Normal IMF practice is to lend only up to twice a country’s quote in one year. This was eight times as high.
Four months later, on August 29, just as Kiev began losing its attempt at ethnic cleansing against the eastern Donbas region, the IMF signed off on the first loan ever to a side engaged in a civil war, not to mention rife with insider capital flight and a collapsing balance of payments. Based on fictitiously trouble-free projections of the ability to pay, the loan supported Ukraine’s hernia currency long enough to enable the oligarchs’ banks to move their money quickly into Western hard-currency accounts before the hernia plunged further and was worth even fewer euros and dollars.
This loan demonstrates the degree to which the IMF is an arm of U.S. Cold War politics. Kiev used the loan for military expenses to attack the Eastern provinces, and the loan terms imposed the usual budget austerity, as if this would stabilize the country’s finances. Almost nothing will be received from the war-torn East, where basic infrastructure has been destroyed for power generation, water, hospitals and the civilian housing areas that bore the brunt of the attack. Nearly a million civilians are reported to have fled to Russia. Yet the IMF release announced: “The IMF praised the government’s commitment to economic reforms despite the ongoing conflict.” A quarter of Ukraine’s exports normally are from eastern provinces, and are sold mainly to Russia. But Kiev has been bombing Donbas industry and left its coal mines without electricity.
So the oligarchs get to protect their money, austerity is imposed, and Kiev funded it’s failed slaughter campaign in Ukraine’s eastern provinces. Nothing about any of this will assist with poverty reduction.
Meanwhile, in America, the poverty picture is much more extensive than government reports indicate:
More than 40 percent of Americans between the ages of 25 and 60 will be poor for at least a year. Over the same period, more than half will be poor or nearly poor, with income at 150 percent of the poverty line, or about $27,000 annually for a family of three. So poverty in the U.S. is, in fact, a much larger problem than we think it is, and it’s one that most Americans will face.
Poverty is seeping into more places in this country – places it didn’t exist before, as seen in the growing rate of child hunger in wealthy suburbs. Why? Income inequality. It’s harder to kick a field goal when you keep getting moved back up the field. It’s harder to move out of poverty into wealth when that distance is growing by leaps and bounds.
It’s basic math. There’s simply no way that we can have conditions that allow the top 10 percent of Americans to pocket ever-increasing amounts – now 77 percent of the nation’s income, leaving the other 90 percent of people with the 23 percent of income that remains – without growing economic insecurity in the rest of the nation.
The fix? As one TalkPoverty Blog reader put it: “We need more people who are facing poverty in America to stand up and express themselves, to put a real human face (‘yes, I’m your neighbor’) on this politically & socially abstract issue.”
Societal shame keeps people from standing up and expressing themselves, and if they did, who in this country will listen? Our politicians? No, they are too busy with fundraisers to listen to poor people. Our media? No, poverty is depressing and probably not the best way to sell ad space.
I think it’s important to understand that poverty is a result of policy, not the moral failings of the impoverished. I’ve written over and over again that the policies that have been imposed since Wall Street blew up the global economy amount to an escalation of class warfare by those who now totally control our political system. That is the reality facing more and more Americans.
Standing up is not enough. Somehow the marginalized majority must fight back.