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Article Artículo

Both Duvalier and the UN Continue to Try to Dodge Responsibility
There were two significant and possibly historic legal developments in Haiti today. After Jean-Claude Duvalier refused yet again to appear in court today, Judge Jean Joseph Lebrun issued an order for him to appear at the next hearing, meaning Duvalier wil

CEPR / February 21, 2013

Article Artículo

Government

Workers

Gender, Debt, and Dropping Out
The latest issue of the peer-reviewed academic journal, Gender and Society, has an excellent paper by Rachel Dwyer, Randy Hodson, and Laura McCloud on “Gender, Debt, and Dropping Out of College” (which is, unfortunately, behind a paywall). The new paper f

John Schmitt / February 21, 2013

Article Artículo

Globalization and Trade

Honduras

IMF

Latin America and the Caribbean

World

IMF Ignores Proven Alternatives With Recommendations to Honduras

On Friday, February 15, the International Monetary Fund (IMF) announced that it had concluded its most recent Article IV consultation with Honduras. The Fund’s recommendations varied little from those it has offered many other countries in recent years: cut public spending, reduce deficits, reform pensions and depress wages.

The IMF regularly conducts Article IV consultations with almost all of its member countries—with Argentina, which since 2006 has refused to take part in the process, being one notable exception. The official reviews are a way for the Fund to present its analysis of each country’s economic prospects and to advocate for a set of reforms. While it is difficult to precisely assess the influence of the consultations, it has been noted that in many cases the recommended policies have been adopted against popular public opinion. And in countries that end up borrowing from the fund, these policies are often preconditions for receiving future IMF loans.

The Fund’s recommendations on Honduras diverged little from the policies it is pushing in many other countries. Below is a selection from the IMF’s brief (347-word, to be exact) Executive Board Assessment of its most recent consultation with Honduras:

Directors . . . underscored the need to tighten macroeconomic policies and press ahead with structural reforms . . .. [They] welcomed the planned reduction of the budget deficit in 2013, and urged early adoption of the measures needed to ensure this outcome and avoid further central bank borrowing or accumulation of domestic payments arrears. They called for sustained medium-term fiscal consolidation . . . [and] supported plans to restrain the public sector wage bill . . . and emphasized the importance of reducing energy subsidies . . .. Directors concurred that monetary policy should be tightened . . . [and] regarded plans to reform state-owned enterprises as critical to strengthen the fiscal position and support growth, and encouraged timely implementation . . . and welcomed the ongoing reform of public pension funds.

It is difficult to overlook how much this assessment resembles the Fund’s recommendations to European countries struggling to emerge from the global recession. CEPR co-director Mark Weisbrot and Senior Research Associate Helene Jorgensen recently released a paper analyzing 67 Article IV consultations for European member countries between 2008 and 2012, in which the authors found that the lending body was pushing a “one-size-fits-all” approach that often included pro-cyclical policy recommendations. In the paper Weisbrot and Jorgensen summarized their findings, in part, as follows:

This content analysis finds a consistent pattern of policy recommendations, which indicates (1) a macroeconomic policy that focuses on reducing spending and shrinking the size of government, in many cases regardless of whether this is appropriate or necessary, or may even exacerbate an economic downturn; and (2) a focus on other policy issues that would tend to reduce social protections for broad sectors of the population (including public pensions, health care, and employment protections), reduce labor’s share of national income, and possibly increase poverty, social exclusion, and economic and social inequality as a result.

CEPR and Arthur Phillips / February 21, 2013

Article Artículo

Workers

The Family and Medical Leave Act at 20, Part 1
The federal Family and Medical Leave Act, signed into law in 1993 by President Bill Clinton, was a huge step forward for the U.S., which lags behind nearly all other countries in establishing standards that enable people to take the time they need to care

Eileen Appelbaum / February 20, 2013