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Structural Adjustment

The International Monetary Fund has put its structural adjustment programs at the service of many ailing economies, as described here:

The IMF has prescribed the same medicine for troubled third world economies for over two decades:

  • Monetary austerity. Tighten up the money supply to increase internal interest rates to whatever heights needed to stabilize the value of the local currency.
  • Fiscal austerity. Increase tax collections and reduce government spending dramatically.
  • Privatization. Sell off public enterprises to the private sector.
  • Financial Liberalization. Remove restrictions on the inflow and outflow of international capital as well as restrictions on what foreign businesses and banks are allowed to buy, own, and operate.

— Robin Hanhel, Panic Rules!, (South End Press, 1999)

Oddly, those countries that run the IMF have prescribed themselves a different medicine. Put a negative in front of most of the verbs above and you will be closer to reality.

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