7 May 2014, 11:26

Great power-great responsibility: IMF uses its power to sponsor Ukrainian civil war

Great power-great responsibility: IMF uses its power to sponsor Ukrainian civil war

With great power, comes great responsibility. More often than not, the world's most important financial institution, the International Monetary Foundation (IMF), choses to use its power for ill rather than good. In Ukraine's case it is safe to say that the IMF board pushed the country over the brink of a civil war.

Ukraine's economy is collapsing and a big loan from the Fund can help Ukraine avoid becoming a bankrupt nation or at least buy some time for the ailing country to try and fix itself. However, the Washington-based lender chose to act in an utterly ruthless and cynical manner, attaching strings to the bailout package, making sure that Kiev will have to spill a lot of blood in order to obtain the promised money.

The quote from the IMF staff report on Ukraine spells it out: "Should the central government lose effective control over the east, the program will need to be re-designed." The hint couldn't have been more clear. If Kiev fails to destroy the resistance of the federalists in the eastern regions of Ukraine, the junta won't get any money. Basically, the Washington-based lender placed a 4 billion dollar ransom on the lives of the people of Donetsk and Lugansk. If this is not an instigation to civil war and punitive actions against civilians then it is hard to say what is.

Washington has a controlling stake in the IMF and Washington is a signatory of the Geneva statements regarding the Ukrainian crisis. In the spirit of the accords reached in Geneva, Washington could use its influence over the IMF to make the Fund act as a counterbalance to the radical and bloodthirsty elements of the junta. For instance, the Fund could have chosen to force Kiev to negotiate with the federalists, making such peace negotiations and a cease-fire the preconditions for getting the loan. However, the US chose to use the Fund to pour gasoline in the fire of Ukraine's internal conflict. Imagine the outrage, if Russia offered President Yanukovych several billion dollars requiring him to violently quash the protests in Kiev. Mainstream media would have said that Russia is paying for murders. When the IMF explicitly pays Kiev to kill people in Lugansk and Donetsk it is "business as usual" and no one dares call Christine Lagarde a sponsor of a civil war.

The Fund's action highlight the need to establish a new, BRICS-sponsored financial institution that could provide a viable alternative to the IMF and also explains why Washington does its best to keep the IMF under its full control. The Fund pays for war crimes and should be therefore considered a criminal organization. The IMF has crossed the ultimate red line.

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