The Essential IMF Debate

Eric Cantor and House Republicans quietly wage war with congressional Democrats over a war supplemental provision that could put billions of American taxpayer dollars in the hands of terrorists worldwide

House Republican Whip Eric Cantor has been ruffling feathers on the House floor over the past few weeks, most recently going toe-to-toe with House No. 2 Steny Hoyer about the ultimate destination of taxpayer money earmarked for the International Monetary Fund in the war supplemental currently before Congress.

The first draft of the spending bill passed the House last month but, since then, the Senate added an additional $8 billion in United States’ funding and a brand-spanking-new $100 billion emergency line of credit for the IMF. House Republicans have balked at the idea, and the vote on this incarnation of the war supplemental has been delayed.

House Minority Leader John Boehner was reported as saying that the plan was “lunacy,” and that America should not be providing the institution with $108 billion inevitably borrowed from the Chinese, and for which “our kids and grandkids” are on the hook to repay. Cantor has reportedly taken it a bit further, pointing out that even The New York Times on May 27, 2009 noted that terrorist group Hezbollah had been involved in talks with the IMF, hoping to obtain a line of credit. Because the final recipients of American taxpayer money used to fund the IMF by means of the war supplemental could be regimes in Iran, Syria and beyond, Cantor argued, providing such funding could lead to the United States funding terrorism across the globe, an idea which would be “a complete affront to our troops combating terrorism across the globe.”

House Speaker Nancy Pelosi dismissed Cantor’s argument as a “scare tactic,” defending the IMF as a “very important national security initiative” and a “force for alleviating the fury of despair among people, poor people, throughout the world.”

Hoyer, however, admitted that the money provided to the Fund by the United States “could go anyplace . . . it could go to a bad place.”

Meanwhile, one day after noting that numerous requests to meet personally and privately with Pelosi had been spurned, Cantor decided to make his opinions known in an old-fashioned way — in a letter.

June 9, 2009

Dear Speaker Pelosi, Leader Hoyer, and Chairman Frank:

Recently you have dismissed as “demagogic” and “scare tactics” concerns that have been raised by Democrats and Republicans alike that resources of the International Monetary Fund (IMF) could wind up in the hands of state sponsors of terrorism and other rogue states. Yet I am confident that if you believed that IMF resources were going to go to countries like Iran, Venezuela, Sudan, and Syria you would take all necessary steps to halt such transfers. I write today, because under an IMF proposal endorsed by the Administration on April 25th, resources will, without question, go to these countries.

The IMF has proposed, and the Administration has endorsed, an increase of $250 billion for the Special Drawing Rights (SDRs) of all IMF countries. As you are aware, SDRs are an IMF created currency that can be exchanged by member countries for low-interest loans of hard currencies, such as dollars. According to the IMF, this new SDR allocation will be made proportionally to all IMF members at a rate of approximately 77% of each IMF member’s quota. With an exchange rate of $1.55 per SDR, that means that Venezuela will receive a benefit worth up to $3.2 billion, Syria $350 million, Sudan, $202 million, Iran $1.8 billion, Bolivia $204 million, Myanmar $308 million, and Zimbabwe $421 million. Given that Venezuela, Zimbabwe, Sudan, and Myanmar have all historically converted much of their current SDR allocation into hard currency, we expect these countries in particular to turn this new SDR allocation into hard currency.

Under existing law, the Administration does not need Congressional approval for this proposal. The Administration only needs to notify certain Congressional Leaders prior to final IMF approval.

I respectfully request that you join me in requesting that the Administration withdraw their support for the IMF proposal to increase SDRs. I further request that any policies related to the IMF, such as those included in the pending war supplemental, be considered under regular order so that Members from both sides of the aisle have an opportunity to make whatever changes are necessary to ensure that resources are not provided to state sponsors of terrorism and other rogue states.

Sincerely,

Eric Cantor
Republican Whip

For months now, I’ve been writing that the GOP, in order to prevail in 2010 and beyond, must absolutely batter the Democrats where they are weakest, the economy and national security being most prominent among those weaknesses. This issue is both rolled up in one, and Cantor should be commended for pointing out that the Democrats in power are not only recklessly spendthrift, but recklessly naive when it comes to matters of national security as well.

In this case, the congressional Democrats’ globalist roots and unfathomable obsession with political correctness not only are increasing the burdensome debt already tumbled onto each and every American, but they are wantonly risking the safety and security of those very same people.

If the voting public could be adequately educated on this issue, this could serve as a microcosm of the coming political debate in America. Why not, after all, insist why Democrats are just fine with spending or committing up to $108 billion we do not have, or knowing that those billions in taxpayer money could be used to fund terrorism across the globe? I’m not fine with that idea and that knowledge, I’m not okay with our money going to a “bad place” — I think it would greatly benefit America to know exactly why the Democrats are.

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Comments

  1. John Cardillo says:

    Ludicrous, but not surprising.

    Hoyer went as far as to say "money could go to a BAD place".

    Look, if we don't hammer, and I mean HAMMER, the left on national security, and their ignorance of global dangers, we deserve to lose.

    One of McCain's biggest mistakes was dismissing the Ayers connection. He did more for the Obama PR machine to make Ayers a non issue than anyone else.

  2. Gail B says:

    Careful, Republicans in Congress! You might convince the Democrats they really don't know what they're doing!

    Just because the conservative Republicans make better sense than the liberals, that doesn't mean that the liberals aren't working hard at–at–at something!

    The liberals haven't made a good decision since they've had control of the Congress.

  3. Rix says:

    A message like "Democrats give taxpayer money to Hezbollah" doesn't cut it as more and more people feel disengagement between themselves and the state coffers. It must sound like "Democrats give YOUR money to Hezbollah" or "House Democrats push to pledge $300 of YOUR PERSONAL money to buy explosives in Middle East". After all, even the most liberal minded voters could find extra $300 a better use…

  4. GO BUY A PIPE ON ME says:

    This is like someone with REALLY BAD credit walking up to a homeless person with an obvious crack habit and giving them their VISA card. Give me a break Washington. asses

  5. Anonymous says:

    I agree whole-heartedly with "John Cardillo" and also with you, Jeff, but the caveat is in your words "If the voting public could be adequately educated on this issue —".

    Just look at the electorate that the Obama adminstration energized to win this past election and you will get the problem; how to "educate" the likes of Acorn and brain-dead (or, shall we say, "intellectually-formed within the William Ayers-developed educational system")voters? As Bill O'Reilly would say, "they're all at the mall".

    Good luck.

    Old Bob

  6. DOOMED says:

    You can't fix S T U P I D.

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