Is This the End of ‘Socialism for the Rich’?

Last Thursday, the International Monetary Fund spooked the markets and surprised the commentariat by chiding the U.K. Conservative government for fiscal irresponsibility. The shock was palpable. For the IMF to criticize the government of a major Western economy was a little like the janitor scolding the landlord for putting the building’s assessed value at risk. That sense of a reversal of the usual order of things was all the sharper because, lest we forget, it was Britain’s Tories, under Margaret Thatcher’s steely leadership, who wrote the book on fiscal probity as the bedrock of neoliberalism. The IMF spent more than four decades inflicting that orthodoxy upon hapless governments the world over.
As if in a bid to amplify the stir it knew it would make, the IMF’s communiqué went so far as to censure the British government for introducing large tax cuts (now partially canceled after the IMF intervention), because they would mainly “benefit high-income earners” and “likely increase inequality.” Tories loyal to Britain’s beleaguered new prime minister, Liz Truss; America’s feistier Republicans; international economic pundits; and even some of my comrades on the left were briefly united by a common puzzlement: Since when did the IMF oppose greater inequality? One would be hard-pressed to identify a single IMF “structural adjustment program”—ask Argentina, South Korea, Ireland, or Greece (where I was once a finance minister who had to negotiate with the IMF) about the strings attached to its loans—that had not increased inequality. Had the fund’s hard-nosed

— source | Yanis Varoufakis | 10/10/2022

Nullius in verba


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