Cost to U.S. Taxpayers May Reach $150 Billion;
Administration Should Veto Accord at Next IMF Meeting
Vice Chair Will be on Fox News at 4:20 PM EST Today to
Discuss Latest Developments
Washington, D.C. – Rep. Cathy McMorris Rodgers (R-WA), Vice Chair of the House Republican Conference, expressed grave concern after European leaders announced that the size of their fund to bailout European Union (EU) countries with the help of the International Monetary Fund (IMF) would soar to $1.4 trillion. This agreement to subsidize the failed socialist policies of our economic competitors will likely cost U.S. taxpayers over $150 billion and increase the likelihood that further bailouts will be necessary down the road without addressing the root causes of the global debt crisis.
“At a time when the federal government is borrowing $5 billion every day on top of a $15 trillion national debt, we should not be funneling billions of dollars through the IMF to bail out Greece, Portugal, Ireland, and other wealthy European countries. The European Union was set up to be an economic competitor to the United States, and therefore, any bailout funds should come from the E.U., not the U.S. The global debt crisis was caused by too much spending and borrowing and that crisis will not be solved by more spending and borrowing. We cannot take the ‘too big to fail’ philosophy to a global level. The only thing ‘too big to fail’ is America itself.”
The IMF has been funding one-third of the cost of the European bailouts. Before today’s agreement, the IMF had already committed $354 billion to bailing out European governments. After today’s agreement was reached, IMF Director Christine Lagarde announced, “I can assure you that the IMF will continue to play its part in supporting the efforts made today.” According to news reports, that means the IMF is poised for a “bigger role.”
The U.S. is the leading contributor to the IMF. In 2009, when the IMF substantially increased its SDR Special Drawing Rights (SDR) allocation, the U.S. provided one-third of the funding. According to IMF rules, the U.S. has the power to veto all bailout agreements.
Rep. McMorris Rodgers called on President Obama to veto any agreement at the next IMF Board meeting. She is the author of H.R. 2313 which would rescind the IMF’s authority to spend up to $108 billion of U.S. taxpayer money that is currently available to fund these disastrous bailouts.
A full compilation of the Congresswoman’s work on this issue can be found here.