Congress’s recent vote to send 18 billion American dollars to the International
Monetary Fund—the agency that tries to bail out troubled foreign economies—is
bad news for those economies and for Michigan.
The IMF has a track record of harming, not helping, the economies of struggling nations such as Russia and Indonesia. It takes tax money from some countries and gives financial aid to other countries whose governments often wreck their economies with job-destroying taxes and regulations. IMF aid rewards bad policies and postpones the day when these governments must institute responsible economic policies.
IMF aid also hurts Michigan two ways. First, Michigan workers’ taxes are taken to support the IMF’s destructive spending sprees. Second, IMF aid hinders Michigan’s foreign trade.
Michigan exports 13 percent of its production, more than the national average of 10 percent. When IMF aid helps ruin other countries’ economies, it cripples foreigners’ ability to buy our products. Michigan workers who make those goods suffer.
Michigan should urge Congress to stop underwriting the IMF’s harmful economic policies so other countries will be encouraged to institute the free-market reforms that help boost job growth and prosperity here and abroad.
For the Mackinac Center, this is Catherine Martin.