For over sixty years now, the International Monetary Fund (IMF) has served as a key instrument of the liberal international economic order (LIEO). Free trade, loans to aid development, and the decline of command economies have all been results of this institution—much to the delight of countless actors across the international stage. Yet the past decade has hosted a particularly strong wave of criticism. The 2007-08 financial crisis, as Eric Helleiner shows us, damaged the legitimacy of both IMF policies and leadership. From that time through today, many have insisted that a “new Bretton Woods” occur as to totally begin again in our structuring of global finance. Helleiner and I are, at our cores, opposed to such a move. This is largely because a “new Bretton Woods” is almost impossible, but also because a “new Bretton Woods” seems rather counterintuitive.
The IMF’s current legitimacy crisis is largely a backlash from the harm caused by its neoliberal policy prescriptions, particularly the harsh austerity measures it has imposed on client-states. There is a very long list of countries in the developing world that have come to the IMF for help during a major debt and economic crisis, only to see the crisis get worse and more prolonged as a result of the IMF’s policy prescriptions and budget cuts. The after affects still linger to this day in many former IMF client-states that have subsequently suffered from sluggish growth and higher poverty and unemployment. Continue reading IMF’s Legitimacy Crisis Is the Result of Decades of Failed Neoliberal Policies. By Matthew Lesso
The financial crisis of 2007-2008 shook the very foundations of the globalized financial world. By destabilizing the global economy, the meltdown created a legitimacy crisis for the Bretton Woods system. The International Monetary Fund (IMF) was the brainchild of the 1944 Bretton Woods Conference and put forward an era of intense market liberalization. Under the leadership of the super-powerful United States, the world (or at least those 45 allowed into the original institution) entered a new age of interdependence. However, times have changed. The United States is not the powerhouse it used to be, with economic power spreading as more countries enter the global markets. Legitimacy of the IMF and the effects of domestic economic problems on the rest of the world have created a lack of faith in how the IMF handles crises, leading to issues and impediments for governments to cooperate. Continue reading The Changing Global Financial Market and the Static IMF – Paige Moeller
Mearsheimer takes a very bleak stance on institutions in international institutions. He states in the opening of his article that his “central conclusion is that institutions have minimal influence on state behavior, and thus hold little promise for promoting stability in the post-Cold War world.” (http://mearsheimer.uchicago.edu/pdfs/A0021.pdf) He spends the majority of his article showing how none of the institutionalist theories work in the real world for using institutions to prevent war and promote peace. He spends almost no part of the article trying to think of ways in which an institution might work. Continue reading Institutions: Anymore Effective Now? – Graham
Blogs have become a common tool for communicating ideas and analyzing developments in global governance. Further, many organizations have increasingly asked staff or recruited analysts to write blog posts to enhance the organization’s social media presence, engage others in the field, highlight important developments and explain its work to important constituencies. Continue reading Blogging for SIS 280 – Prof. Michael Schroeder