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Excellent thread from @ErikVoeten on the WHO and how the institutional structure of global governance shapes outcomes and hinders the effectiveness of the WHO, as is the case w/ so many international organizations.
A couple of caveats re: the IMF analogy, though (1/n): https://twitter.com/ErikVoeten/status/1250395924439928833
A couple of caveats re: the IMF analogy, though (1/n): https://twitter.com/ErikVoeten/status/1250395924439928833
2/ The IMF doesn’t really “control” its own “pot of money.” It is ~a credit union. The pot consists of quota contributions of members, & loans must be approved by the Executive Board where 8 countries hold their own seats (
) & 16 others represent groups (~UNSC).
) & 16 others represent groups (~UNSC).
3/ So the IMF has a much larger pot than the WHO, but states, via the EB, must approve each loan, both initially & at subsequent stages. The staff exercises some autonomy over negotiation & design of loans/conditionality. This gives it agenda-setting power and influence.
4/ But, though less so than the WHO, the IMF still highly constrained in its ability to act independently and quickly.
5/ IMF voting power is proportional to quotas. The US has 16.5% of the votes. But loans require the support of countries w/ a majority of votes. Formal votes rarely take place, but the MD, chairing the EB, calls for consensus w/ respect to voting power
https://www.imf.org/external/pubs/ft/pam/pam53/pam53.pdf.
https://www.imf.org/external/pubs/ft/pam/pam53/pam53.pdf.
6/ So the US can’t actually approve/veto loans on its own. It needs the support of other major shareholders to build “consensus.” There is much confusion about this, in part b/c the media often reports that the “US blocks” loans w/o making clear that it cannot do this on its own:
8/ It also means that while IMF lending favors countries important to the US (politically & financially), it also favors those important to the other major shareholders, especially the Europeans.
9/ Much of what appears in statistical analyses of IMF lending as “US allies” getting favorable treatment is actually picking up the shared political affinity of a borrower to all major shareholders. Preference alignment (or not) among the "G5" is key. https://academic.oup.com/isq/article-abstract/54/1/49/1795447
10/ Disagreements b/w the US & these other large countries over a borrower's political or financial importance strongly influence IMF loan size/conditionality. We see substantial evidence of both conflict & logrolling b/w major shareholders in the IMF:
https://www.amazon.com/International-Monetary-Fund-Global-Economy-dp-0521143586/dp/0521143586/ref=mt_paperback?_encoding=UTF8&me=&qid=1586967723
https://www.amazon.com/International-Monetary-Fund-Global-Economy-dp-0521143586/dp/0521143586/ref=mt_paperback?_encoding=UTF8&me=&qid=1586967723
11/ We are seeing this play out again w/ respect to Iran. The US hasn’t vetoed a loan to Iran yet, because it can’t w/o support from other countries: https://www.reuters.com/article/us-health-coronavirus-imf-iran/imfs-assessment-of-iran-funding-request-is-taking-time-official-idUSKCN21X1CL.
There is substantial conflict right now b/w the US and EU over this. The outcome is uncertain.
There is substantial conflict right now b/w the US and EU over this. The outcome is uncertain.
12/ So, the IMF has far more $$ than the WHO, but it still depends heavily on the $$/political support of powerful states. These structural constraints, as in global health, are so often why the IMF is not set up to succeed in crises. See @PaulBlustein:
https://www.amazon.com/Laid-Low-Inside-Crisis-Overwhelmed/dp/1928096255
https://www.amazon.com/Laid-Low-Inside-Crisis-Overwhelmed/dp/1928096255
13/ An IMF w/ more control of its own resources/independence would also be better positioned to do its job in crises. It would have greater legitimacy w/ borrowers. OTOH, this bias keeps the US/Europe invested in the IMF & willing to fund the Fund. Tradeoffs in everything /fin
