‘Budget cuts for Europe like pouring gas on fire’

Russian TV interviewing Mark Weisbrot who is is an American economist, columnist and co-director, with Dean Baker, of the Center for Economic and Policy Research in Washington, D.C.: "What about the BRICS powers? Those rising powers versus the voting rights at the IMF and the whole debate that took place at the spring meetings?"

Mark Weisbrot: "These institutions have been controlled by the US since 1946. And it has not changed much at all. Some people think the Europeans control the IMF because they get to appoint a European, but that is not true. The US has the veto over the European head of the IMF, and they still have the dominant voice at the IMF. And Europe is the junior partner. That’s changed a little bit in recent years because now more than 60 per cent of the IMF loans are in Europe and the US Treasury Department would defer to Europe for matters that are focused on Europe. But in the rest of the world, in all the developing world where the IMF still makes loans it is US-decided. So, they control both: the IMF and the World Bank, which is two out of the three international institution that have any power. The third one is the Security Council. And there they have the veto as well. This is the world after World War II. And global governance has not changed. That is one of the reasons why they created the G20. But it is still the G7 making all the decisions – and mainly the G1 here in Washington – because that is who has power in these institutions of international governance that actually have power." 

Read more: ‘Budget cuts for Europe like pouring gas on fire’ — RT