Astonishingly, 60
percent of IMF lending, or $87.9 billion, has gone to just three countries,
Greece, Portugal, and Ireland that have been rocked by sovereign and mortgage
debt crises. The U.S. share of those European bailouts is now $21.1 billion.
Should things worsen in Europe, we may ultimately wind up wishing we could get
that money back from this foreign aid slush fund.
Initially, the IMF was
set up by the West to issue foreign aid to third world nations during the Cold
war. It was never intended to bail out advanced economies, but now that is
exactly what it is doing.
The U.S. stake in the
IMF used to be just $57 billion a few years ago, but in 2009, the Pelosi-Reid
Congress expanded contributions by $108 billion on top of that to a $165
billion total, including a $65
billion quota and a $100 billion
line of credit. That is more than triple the first year of
sequestration’s $53 billion cut to outlays. No more votes will occur now to
approve further bailouts, as the agency can lend it all away if it desires.
Hiding this theft of
American taxpayers, almost none of this appears on-budget, but like student
loans, when the IMF draws from these lines of credit, it gets drawn directly
from the Treasury by being added directly to the national debt.
As if all that was not
bad enough, when the agency is not busy bailing out bankrupt socialist
governments and the banks that enable them, it is looking for ways to impose
crushing taxes on the American people.
For example, in a recent
study the IMF called on the U.S. to levy a $500 billion a year carbon tax
on consumers to offset what it calls “underpriced” oil, coal, and other energy
products.
This “mispricing” is
supposedly leading to “excessive energy consumption,” which is “accelerating
the depletion of natural resources” and contributing to climate change.
The carbon tax would supposedly
counteract these trends: “The efficient taxation of energy further requires
corrective taxes to capture negative environmental and other externalities due
to energy use (such as global warming and local pollution).”
Still think the IMF
holds U.S. interests at heart? In 2009, the G20 asked the agency to come up
with ways to bail out the financial sector by imposing even more taxes on the
American people.
That IMF study
released in 2010 essentially proposed two types of taxes: a levy on
financial institutions to create a pool of bailout funds, and a financial
transaction tax. It came atop passage of the Dodd-Frank so-called financial
reform legislation.
Sure enough, under
Dodd-Frank, the Federal Deposit Insurance Corporation (FDIC) is charging
assessments to about 60 bank-holding and insurance companies with $50 billion
or more in assets to finance what is called an “orderly liquidation fund.”
Really, it’s just a bailout fund allowing the government to take over
systemically risky institutions, recapitalize them, and allow them to reenter
the market under new management.
Of course, the
American people bare the burden, as a Congressional
Budget Office (CBO) analysis of a similar bank tax proposal by the Obama
Administration at the time noted, “the ultimate cost of a tax or fee
is not necessarily borne by the entity that writes the check to the government.
The cost of the proposed fee would ultimately be borne to varying degrees by an
institution’s customers, employees, and investors, but the precise incidence
among those groups is uncertain.”
Under the law, that
can come in the form of fees for merely holding a checking or savings account.
Sure enough, such account
fees are already being charged by many financial institutions and have in fact
been increasing since the passage of Dodd-Frank, reports ABC News. The law also
grants the Federal Reserve broad rulemaking authority over fees imposed
by financial institutions.
At a time when the
Obama Administration claims that there is nothing to be cut from the budget,
the IMF appears as very low hanging fruit. Continuing to fund the agency with
an open-ended $165 billion line of credit does nothing to advance U.S.
interests. That is why Congress should proactively take up legislation to stop
this foreign aid slush fund once and for all.
Source: NetRightDaily.com: http://netrightdaily.com/2013/04/u-s-lends-35-billion-through-imf-foreign-aid-slush-fund/#ixzz2S1JwJuF7
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