Hugo Chavez: A people's alternative to Structural Adjustment

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Budhoo was the first person to break the IMF's code of silence regarding internal affairs by exposing extensive statistical fraud carried out by the fund in Trinidad and Tobago during 1985-1987.

The IMF and World Bank are separate institutions with distinct roles. While the bank makes loans for development projects, the IMF lends to governments to ease deficits and make their economies appear stable to the international market. The World Bank was created in April 1944 as a lending institution composed of member governments to help rebuild post-war economies. The IMF was created to restructure and organize the market systems of member nations by promoting international economic cooperation and trade, and by encouraging stable currencies.

The bank introduced Structural Adjustment Programs in 1980 to increase export production in debtor nations to provide cash for debt-service payment. Under "structural adjustment," developing countries typically are required to devalue their currency; dramatically cut spending on social services, medical care and education; eliminate barriers to foreign multinationals and trade; privatize national assets; deregulate business; decrease wages; restrict credit and raise interest rates.

Due to the radical reorganization of national economies, people in "SAPed" countries often pay for their governments' loans with extreme poverty, hunger and disease. Using figures provided by UNICEF and UNDP, the editors of the IMF-World Bank Watchdog estimated that more than six million children under the age of five have died each year since 1982 in Africa, Asia and Latin America as a result of IMF / World Bank policies.

SAPs often carry heavy ecological costs as well. The forced privatization of nationalized industries and public or communal lands often opens Third World countries to opportunistic multinational corporations resulting in degraded (or destroyed) and polluted environments. Placing the emphasis on exports rather than local needs in a time of falling world commodity prices results in exploitation and depletion of oil, minerals, forests and other natural resources.

Even though debtor countries paid more than $1.3 trillion to the IMF between 1982 and 1990, they were still 61 percent more in the hole in the 1990s than they were in 1982. According to the 1988 UNICEF annual report, debt and interest payments by Southern countries totaled more than three times the amount of aid received from the World Bank and IMF.

" Under structural adjustment, the IMF and the World Bank do not merely supervise individual sectors of the economy as in the past... they now manage each country entirely," said an official of the Institute for African Alternatives. "They have to approve annual national budgets. . . monetary, trade and fiscal policies . . . before countries can negotiate with other foreign lending agencies." During his years at the World Bank and IMF, Budhoo learned that core staff members are "successors of colonial civil servants." Pointedly observing that South Africa is administered by the European Department, not the African department, Budhoo concludes that "our staff is the logical consequence... of the prevailing 1944 international ethos of 'superior man' and 'inferior man,' and the white man and his system to be saved and nurtured, and the black / brown colonized man to be overlooked and cast aside...."

IMF staff receive six-figure salaries along with generous perks, including subsidies for travel and foreign work, and housing and education for family members. A staffer on assignment in the South often receives more basic pay than a head of-state. Newly recruited staff are often wined and dined, offered fat consultancy fees and lucrative, tax-free salaries to lure them into compliance with the IMF against what may be their better judgment. The promise of becoming a member of the "new nobility of Earth" can be overpowering.

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