The International Monetary Fund stands ready to help riot-torn Egypt rebuild its economy, the IMF chief said Tuesday as he warned governments to tackle unemployment and income inequality or risk war. Dominique Strauss-Kahn (left) also said rising food prices could have "potentially devastating consequences" for poorer nations, and warned that Asia's fast-growing economies faced a risk of a "hard landing". Overall, according to the IMF managing director, widening imbalances across and within countries were sparking tensions that threaten to derail the fragile global economic recovery — and could even spark armed conflict. – AFP
Dominant Social Theme: The IMF is a very necessary instrumentality.
Free-Market Analysis: It is fascinating to watch world events unfold through the prism of the Internet. In this AFP article (excerpted above), we can see clearly how Dominique Strauss-Kahn, one of the more brutal and obvious functionaries of the power elite, intends to capitalize on the current Middle Eastern turmoil for the benefit of his agency, the International Monetary Fund.
Strauss-Kahn has attempted before to use various crises before to burnish the reputation and utility of the IMF. Most recently, he gave an interview given to Der Spiegal that cast the IMF as an inevitable precursor to a world central bank. At the time, we wrote Strauss-Kahns position seemed to be that the IMF, "need only graduate from SDRs to bancors and expand its monetary authority." His comments were so extreme that our analysis concluded that the Anglo-American elite "seems to have shed any inhibitions about moving slowly or deliberately toward global governance goals."
Now, Strauss-Kahn is at it again, predicting doom and gloom – a series of fear-based dominant social themes – and proposing the IMF as the solution. In a speech made in Singapore, he claimed the IMF stood ready to help with various global imbalances, including an emergent food shortage. "The IMF is ready to help in defining the kind of economic policy that could be put in place," he asserts.
Strauss-Kahn is eager to unearth potential ruin in the Middle East. He indicated that unemployment and a growing income gap was a "strong undercurrent of the political turmoil in Tunisia." Other countries exhibited "rising social strains," and these strains, he seems to believe could lead to "rising protectionism of trade and of finance."
In the speech, Strauss-Kahn reportedly worried about protectionism as a result of potential discord between nations. Within this context, he mentioned China's undervalued yuan but did not emphasize an immediate adjustment as regards the US dollar. Such a reconfiguration ought to be a slow one to avoid shocks to the larger global economy, he indicated. "While the recovery is under way, it is not the recovery we wanted," he reportedly said. "It is a recovery beset by tensions and strains — which could even sow the seeds of the next crisis."
He was concerned about the differing pace of different economies, which he saw as presaging the global economic crisis of 2008. "While growth remains below potential in the advanced economies, emerging and developing economies are growing much faster — and some may soon be overheating." Presumably, he was referring to China and the BRIC countries when making this statement, as price inflation is increasingly a factor in Brazil and India as well. Finally, he mentioned food prices, reportedly pointing out that they were rising "with potentially devastating consequences for low-income countries," he added.
Strauss-Kahn, like his World Bank counterpart Robert Zoellick, believes that the global institutions have a heady role to play in easing or ameliorating the world's problems. Zoellick recently wrote an article for the Financial Times (which the Bell analyzed) making the case that the G20 itself ought to become more deeply involved in the world's food situation. We pointed out the following:
It is actually a perfect example of an elite, fear-based mechanism at work. By creating nation-states, encouraging ethnic rivalries and generally stirring the pot, the Anglosphere has ensured a level of simmering chaos that makes it difficult if not impossible for certain societies to feed themselves on a regular basis. Africa's nation-states obviously come to mind. Having helped trigger the food-crisis, the Anglosphere is now beginning to make fixing it a priority. But as with so many other endeavors (when it comes to the Anglo-American axis), one has to approach the concept of "fixing" with some trepidation … These elite promotions tend to work as narratives, leading to the observer logically from one point to another.
One can, in fact, see in these crises and dislocations the slow circling of elite institutions. In a recent interview with Bloomberg news, Henry Kissinger commented on African and Middle Eastern unrest, saying, "This is only the first scene of the first act of a drama that is to be played out." The comment sounds more like a prediction than an observation. And food in the hands of Western elites certainly constitutes a weapon, a way of driving the world toward further sociopolitical consolidation.
The overwhelming impetus of people like Strauss-Kahn and Zoellick is to involve their institutions in the market whenever possible. It is a template for global governance. Every human act is to managed and even micromanaged and the place for a market-driven is honored only in the breech. Soon it will exist more as a talking point than a reality.
As we have indicated, elite plans are almost impossible to realize. The Invisible Hand of the market will have its way no matter what. Human beings are never immune to economic law. Of course, one could argue that the power elite is well aware that its solutions merely reflect and amplify the chaos being generated. Perhaps this is actually the point.