THE INTERNATIONAL Monetary Fund is back in business. And how! The volume of its emergency lending, meant to tide countries over when private markets are no longer willing to lend to them, is at an all-time high. It is taken seriously once more at the tables of high finance. Perhaps this is no more clearly evidenced than in its central role in the recent discussions on stabilizing the euro area. No longer is the IMF only the lender of last resort for the poor, weak and struggling nations of the world; to prevent the Greek debt crisis from spreading throughout the eurozone, the IMF stepped in with 30 billion euros worth of financing (far greater than any individual national contribution) to help shore up Athens’s balance sheet.
By the metrics of how much its emergency lending and its programs for troubled countries are needed, the Fund is indeed a successful organization—much in demand. But this very demand is a measure of its failures in preventing the kinds of policies that lead to crises—especially ones of the global variety.