There is an intriguing piece in today's New Republic that asks "Why is the IMF Chief Almost Always French?"
The question is certainly warranted: since the Bretton Woods meetings in 1994, where France was not represented, five of its twelve managing directors have been French. The answers, from Harvard's Dani Rodrik and Jeffrey Frankel, and the Center for Global Development's Arvind Subrramanian, are also sensible: within the framework of the informal agreement according to which the World Bank would go to an American and the IMF to a European, given that the a Brit can never really be seen--including by many Brits--as a full-fledged European, and thanks to France's elite Public Sector prep-schools--les Grandes Ecoles-- the French have won "on merit" most times. Their fanatical attachment to these positions, the relative proximity of World War II still plaguing the Germans, their lack of seriousness the Italians, and the small size of their economies everybody else, round up the field of explanations.
All bland stuff. The interesting part is the paper's blindness to the absurdity of the arrangement given Europe's and France's quickly declining global status. With Asian economies building up reserves that dwarf the IMF's, Latin American countries now net creditors on global financial markets, and both Brazil and Mexico, along with China, Russia and India among the top 12 economies in the world, the powers that be at the IMF will have to choose between keeping the French in the driver's seat of a vintage gaz-guzzler, or getting a "Southerner" to drive a high-tech "zero-emission" speedster that will really get the world through the traffic.
Much more perceptive views can be gleaned from a different piece by Subramanian, who points out that the voting was rigged by rules that give European countries an overwhelming plurality of votes and that will have to change if the Fund wants to keep any degree of legitimacy. He also adds that Lagarde's election reflects the lack of unity of BRICS countries. A related point is taken up by Peter Hakim and Carlos Acosta Córdoba, who ask why Brazil did not support Mexico's candidate, and find an answer in Brazilians'--ultimately successful--brinkmanship to get the top job at the FAO, an endeavour that was not supported by Mexico.
Divisions among the BRICS and the big Latins come as no surprise: their interests are, to say the least, heterogeneous. For Western policy-makers and analysts to take for granted that no compromise can be reached among them, however, borders on schizophrenia.
Photo Jonathan Blair
