[Congressional Record Volume 144, Number 95 (Thursday, July 16, 1998)]
[House]
[Page H5638]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




         REJECT QUOTA INCREASE FOR INTERNATIONAL MONETARY FUND

  (Mr. ARMEY asked and was given permission to address the House for 1 
minute and to revise and extend his remarks.)
  Mr. ARMEY. Mr. Speaker, yesterday the Committee on Appropriations 
Subcommittee on Foreign Operations rejected an attempt to give the 
International Monetary Fund an additional $14.5 billion. I commend the 
subcommittee for saying ``no'' to this vast increase in IMF funds. In 
the coming weeks, I expect the House will soon vote or on a floor 
amendment to add the additional money. It is critical that we reject 
that amendment.
  Events in Russia this week prove that the IMF is a destabilizing 
force in world economic affairs. The ever-present hope of an IMF 
bailout, reinforced by the unprecedented bailouts offered Asia last 
year, completely undermine the Russian Government's incentive to reform 
its economy. IMF, by undermining Russian discipline and underwriting 
irresponsible policies, played a key role in causing the Russian crash.
  The problem is that the IMF creates moral hazard. When you subsidize 
financial mistakes, you get more financial mistakes. That is exactly 
what the IMF does. It causes the very panics and crashes it is intended 
to prevent.
  Mr. Speaker, several years ago another Congress passed a hugely 
popular bill by enormous margins to bail out the domestic American 
savings and loan industry. It was a disaster. It led directly to the 
$150 billion S&L fiasco. I do not want the legacy of the 105th Congress 
to include a similar disaster on a global scale.
  Mr. Speaker, let us break the bailout psychology and strengthen the 
world economy by rejecting a quota increase for the IMF.

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