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IMF Funding Dealt Second Major Setback

© Bryan Johnson

President Clinton is requesting that the U.S. provide some $17.9 billion in new funding for the International Monetary Fund (IMF). The U.S. Senate already has passed legislation that provides this money. However, in the U.S. House of Representatives, the story is different.

[ Editor's Note: This is the ninth article on the IMF to appear in Political Economy. For previous articles on the IMF, see Bretton Woods Revisited: IMF; Congress Gears Up For IMF Funding Debate; Congress Deals IMF Major Setback; IMF Skepticism Grows in Congress; New IMF Strategy Emerges in Congress; Congress Tackles IMF Tax Subsidy Issue and American Farmers Fall In Love With IMF - Editor - BTJ .]

In the House, lawmakers are more skeptical over committing more money to the 54-year-old organization without substantial reform. In fact, in May the House moved to follow the Senate and appropriate the full $17.9 billion. But that move failed as it was apparent that there was not enough votes to secure passage of the bill.

Then, last week, the House subcommittee on foreign operations voted down another attempt to provide the full $17.9 billion when it marked up its annual foreing operations appropriations bill. Instead, the subcommittee appropriated only $3.4 billion. However, IMF supporters planned on adding the rest when the full committee was scheduled to mark up the bill this week. After Rep. Dick Armey (R-TX) announced that the IMF "probably would get all the money it wants" to the U.S. Chamber of Commerce, the end of the stalemate seemed over (Armey being the biggest of House opponents to funding the IMF).

However, when Appropriations Committee Chairman Bob Livingston (R-LA) moved to add the additional money, Armey switched gears and enlisted the support of the rest of the House leadership to vow a major fight over the fuding increase. Thus, Livingston was forced to withdraw the bill altogether.

So now, there are very few options for passing the increased funding:

1) The Appropriations Committee will try to bring it up again before the August recess.

Problem: There are very few legislative days left to bring this bill back up before the recess. Moreover, opponents of the IMF are growing stronger, not weaker.

2) The Appropriations Committee will try to bring the bill up after the August recess.

Problem: With so much work left to be done on the annual spending bill, the schedule is crammed. Getting the IMF bill to the floor before the end of the fiscal year will be a challenge, even if the House leadership supports it.

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