Simon Johnson thinks so:
This is not an anti-Greek suggestion. The IMF has changed a great deal over the past 10 years â?? learning lessons and developing new ways of thinking. (For more detail, see my current Project Syndicate column.) Todayâ??s IMF would give Greece a much more reasonable deal than would the EU acting alone.But the main reason to approach the IMF is that this, if done properly, would drive the EU nuts in a most productive manner.
The Germans really do not want more IMF pressure to ease up on European Central Bank monetary policy or â?? heaven forbid - to engage in some fiscal expansion (or other increase in domestic demand). The Germans want to export their way out of recession, and the devil take the hindmost.
And President Sarkozy absolutely does not want the current IMF Managing Director - Dominique Strauss-Kahn - to do anything that can be presented as a statesman-like contribution to the world. Strauss-Kahn is a contender for the French presidential election in 2012, so you can see how that works. (Aside: strictly speaking, according to IMF rules, Strauss-Kahn should step down from the Fund; but he is too wily a politician to let anyone push him out at this moment.)
You can track the European debt crisis in our new Eurozone page here.
(AP Photo)
