Archive for May, 2011
By Arvind Subramanian and Nicolas Veron This note provides a quick guide—in the form of a table—to the likely candidates to succeed Dominique Strauss-Kahn as next Managing Director (MD) of the IMF, assuming that he resigns shortly. It also highlights some key points that must guide the process of selecting the next MD.
Need for urgent action. The IMF is at a critical juncture with lots of problems to solve, not least in Europe. A leadership vacuum and uncertainty must be avoided, which requires urgent initiatives by the larger players—the United States, Europe, China, Brazil, India, South Africa and others.
Europe can no longer claim the job of MD: Europe no longer has the divine right to this job, irrespective of the circumstances of the European incumbent’s (assumed) departure. The world has changed, and antiquated if unstated arrangements dating from 1945, in which a European heads the IMF and an American heads the World Bank, must keep pace with reality. The next MD must be selected on the basis of merit, which is not to be found only in Europe.
IMF Managing Director Dominique Strauss-Kahn’s detainment in New York City on Saturday has raised questions about the future of the International Monetary Fund (IMF). The short answer to those questions is that the IMF will continue to do its job effectively with or without Mr. Strauss-Kahn as its leader. No individual is or should be indispensable to an institution, and the IMF is no exception to this rule. The IMF has a talented management team, a dedicated staff, and a broadly supportive membership.
Last month, in a Washington Post outlook piece, I argued that if handled adroitly, the triple crisis facing Japan could be used to modernize the country’s politics. The government’s response to the disaster has been anything but adroit, and the opportunity to use the crisis to propel the nation forward is slipping away.
On Wednesday afternoon, April 27, 2011, Federal Reserve Chairman Ben Bernanke gave the first scheduled press conference by a Federal Reserve chairman immediately following a meeting of the Federal Open Market Committee (FOMC). Chairman Bernanke was sure footed and appeared not to be surprised by any of the questions. He answered most of the questions directly, although, like any public official, he did not always answer the question precisely and sometimes declined to do so.