[Congressional Record Volume 144, Number 29 (Tuesday, March 17, 1998)]
[House]
[Page H1172]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




               REGARDING THE INTERNATIONAL MONETARY FUND

  The SPEAKER pro tempore. Under the Speaker's announced policy of 
January 21, 1997, the gentleman from New Jersey (Mr. Saxton) is 
recognized during morning hour debates for 5 minutes.
  Mr. SAXTON. Mr. Speaker, I wanted to speak to my colleagues about 
what I think is a very important issue. It involves the International 
Monetary Fund. That may be a dry issue to some. But when we consider 
that the International Monetary Fund today has available to it $36 
billion of American money, of U.S. dollars, it is a rather sobering 
thought.
  We have lots of needs for money in our country, and we have seen fit 
in a benevolent way to help others around the world with various 
economic situations to the tune of $36 billion. But what got my 
attention, and I hope has gotten Members' attention, is that the 
International Monetary Fund through Secretary Rubin, Secretary of the 
Treasury, has requested $18 billion more. The signs are that that is 
not all they want. If we put that in perspective over the last several 
decades, we have contributed $36 billion to the IMF, and this year they 
are asking for $18 billion more. That is a 50 percent increase in what 
we have provided.
  I guess the question is, is there even more to come? The issue of how 
much we contribute to the IMF is important. But there are other issues 
that are just as important, and that is questions involving how the 
money is used. I am not saying the money is used incorrectly, because 
it may very well be, but the fact of the matter is we do not know and 
we cannot find out, because the IMF operates in a cloak of secrecy.
  Here around our government in Washington, D.C. and throughout the 
States, we learned decades ago that government works better when people 
can visualize what we are doing, when they have access to our process. 
The cloak of secrecy that surrounds the IMF and the reluctance or 
refusal of the Secretary of the Treasury and his staff to communicate 
with us relative to the activities of the IMF are something that needs 
to be changed. My experience in January and February of 1998 have 
revealed that there is a huge reluctance on the part of IMF officials 
and of the Treasury to come forth with information. In fact, they have 
refused on all but one occasion and when they finally agreed to permit 
certain information to come forward to the Joint Economic Committee, 
which I chair, they would have made us promise not to disclose it to 
anyone else. The very same cloak of secrecy would have been imposed 
upon us that we are trying to take away.
  The issue of transparency with the IMF is extremely important. Number 
two, it is also important to recognize that the IMF loans at what we 
call, what I call, subsidized rates. In other words, while American 
taxpayers are paying 7 or 7\1/2\ percent interest for mortgages, the 
IMF loans money to high-risk foreign investors at less than 5 percent. 
In fact, in the last fiscal year, the IMF loaned 90 percent of its 
funds that it loaned at 4.7 percent. That is a subsidized rate. While 
auto loans in this country go for 9 percent to 10 percent interest, the 
IMF was loaning at 4.7 percent to 90 percent of its borrowers. And 
while credit card holders in this country pay 16 to 21 percent or 
greater, the IMF was loaning at 4.7 percent.
  It is bad enough that these subsidized rates were being used, but 
even worse, Mr. Speaker, if we are going to provide these loans to 
people who get themselves in trouble economically, does it not just 
encourage people to make bad loans, to take high risks? Everyone who 
invests in this world, in this country or this world, takes some risk. 
In some cases you invest in a bank. If you invest in a bank in this 
country, Mr. Speaker, those loans are insured. That is a low risk. But 
if you want to take a speculative risk, if you want to take a big risk, 
go get something speculative to invest in.

                              {time}  1300

  If someone is standing there by you as a benefactor saying, if you 
get in trouble, I have a 4.7 percent loan for you, not a bad deal. In 
fact, if we went out on the street corner next to the Capitol building 
and set up shop and said, we are going to make loans at 4.7 percent, 
why, we would have a line stretching around the block. That is what the 
IMF effectively does.
  So I have introduced H.R. 3331, which is a bill that would correct 
the use of these funds with American money, and I urge all Members to 
look at it. ]

                          ____________________