Thomas Pringle (Donegal South West, Independent)

I will respond to some of the Deputies on the other side of the House who said we in opposition should be wearing the green jersey and backing the decisions the Government is making, particularly in terms of the budget and continued austerity it is imposing on the people. It is perfectly legitimate for us not to agree with what the Government is doing, put forward alternative proposals and not support the cuts it is implementing. That is in no way going against the Irish people. Rather, it is arguing on their behalf.

There are alternatives. The Government and we as a people have choices. The Government has chosen to implement its budget. It could have made different choices, which is a perfectly legitimate argument. I do not agree with any member of the Government saying we should get on board with the programme and go along with the cuts and austerity being imposed because they are the only game in town and good for the Irish people. We are absolutely entitled to our view that the wrong programme and the wrong agenda are being pursued.

The legislation before us implements adjustments provided for by the review of the IMF management and voting weight structures, including an increase in the voting power of Ireland to something over 0.5%. This will have hardly any impact on our potential influence in the policy direction of the IMF. It bears repeating that the latter has not covered itself in glory over the years. It has been a tool of Western capital, forcing many poor countries to implement policies that decimated their economies and set their development back by decades. It initially did so in support of the United States in its Cold War against communism and, in recent years, in support of the neoliberal policy of globalisation. In pursuit of these neoliberal policies, the IMF has been heavily criticised for prolonging and deepening the Asian crisis in the 1990s. It forced fiscal reduction, increased taxation and widespread privatisation on Asian economies when what was needed was increased Government investment and stimulus which would have helped them to grow out of the difficulties they were experiencing.

The similarities to our current situation are obvious. According to its own fact sheet, the IMF's role is to maintain stability and prevent crises in the international monetary system and to review country policies and national, regional, and global economic and financial developments. It is worth examining how it has applied its preventative role to Ireland. The IMF was full of praise for our economic model throughout the Celtic tiger bubble. Like the Financial Regulator, Central Bank and the other cheerleaders of the boom, it at no time shouted "Stop" or even "Slow down".

In its country reports in the lead up to the crash, it remained full of praise for the model we were pursuing. For example, it stated on 14 September 2007, "The banking system is well-capitalized, profitable, and liquid, and nonperforming loans are low". The executive directors commended Ireland's continued impressive economic performance, characterised by one of the highest growth rates of GNP per capita among advanced countries and one of the lowest unemployment rates. The report went on to state:

This performance has been underpinned by outward-oriented policies, prudent fiscal policy, low taxes, and labor market flexibility. Given the Irish economy's strong fundamentals and the authorities' commitment to sound policies, Directors expected economic growth to remain robust over the medium term.

By 2009, however, it had changed its tune. On June 24 of that year it stated:

Following years as a star performer, Ireland is undergoing a painful adjustment as critical internal imbalances unwind. Since the start of the decade, and especially from 2005 to 2007, easy credit fostered a property bubble, bank exposures to property lending soared while reliance on wholesale funding intensified, wages rose rapidly, and international competitiveness was compromised.

This is quite a contrast to the previous glowing reports. It went on to state:

The banking system is under considerable stress as asset quality - especially that related to property development - has deteriorated and the global financial crisis has tightened access to wholesale funding.

In 2010, the IMF became one of the major partners in the troika. This was hard to stomach in light of its continued glowing reports even as the crisis deepened. Now we are asked to take direction from one of the cheerleaders of the boom-bust cycle. The IMF has praised the Government for the steps it has taken in forcing austerity on our people and ensuring the gamblers and speculators of the crash are protected, regardless of the costs to society, while cautioning that we should be careful of the impact the cuts will have on the disadvantaged. That must ring very hollow to the disabled, unemployed and low paid who are carrying the can for the developers, bankers and politicians who brought the country to ruin.

The Nobel prize-winning economist Joseph Stiglitz summed up the IMF's mission perfectly when he said:

When the IMF arrives in a country, they are interested in only one thing. How do we make sure the banks and financial institutions are paid?... It is the IMF that keeps the [financial] speculators in business. They're not interested in development, or what helps a country to get out of poverty.

The agenda of the IMF and the troika is to make sure the German, French and British banks that fuelled the boom are paid every cent they spent in driving the property bubble.

Writing in April of this year in reference to Ireland, Mr. Stiglitz stated:

In effect, the International Monetary Fund (IMF) and European Central Bank (ECB) are asking ordinary Irish workers and citizens to bear the burden of mistakes that were made by international financial markets. But it is important to recognise that these mistakes are at least partly attributable to following deregulation and liberalisation policies that were advocated by the IMF and ECB and that these policies provided significant benefits to the financial sector.

He went to state, in respect of the bailout programme:

[E]ven were it to succeed, it will mean Ireland will be in partial indentured servitude for as far as the eye can see – devoting 10 per cent or more of what it earns to pay off what are largely the consequences of the financial sector's misdeeds.

This is hardly an outcome to be welcomed by anybody in this House. One can only wonder what our society will look like when we are finished looking after the financial elites of Europe and the world.

The changes covered by this legislation will remove the automatic right of countries to appoint directors, and all directors will have to be elected. This is no big deal. The voting weights are already heavily in favour of the United States and other Western capitalist economies. The board and decision-making structure of the IMF will continue to be controlled by the same countries that have driven the agenda for the past 60 years. We need only look at the record of the IMF in Asia, Argentina, South Africa and so many other places around the world to see how little that policy will change.

See this speech in context