U.S. politicians attack IMF for its aid to Asia

U.S. politicians attack IMF for its aid to Asia

WASHINGTON (Reuters): The International Monetary Fund came
under fire on Monday for its Asian bailouts as former Republican
presidential candidate Steve Forbes said it and the Clinton
administration were making the financial crisis worse.

"Along with the Clinton-Gore Treasury Department, this agency
has been prolonging and deepening the currency crisis that is
rolling more and more of the world," said Forbes, who is widely
believed to be planning a presidential bid in 2000.

With that criticism, the millionaire publisher joined a
growing list of prominent conservatives and liberals who oppose
the IMF's multibillion-dollar bailouts in Asia.

In a letter to members of Congress, Forbes called on lawmakers
to block billions of dollars in payments that would boost IMF
resources, drained by huge loans to South Korea, Indonesia and
Thailand.

At a community forum in Los Angeles, Federal Reserve Chairman
Alan Greenspan was heckled by community activists for defending
financial aid to Asia when poor neighborhoods in the United
States needed help.

"It's a disgrace" and "You should be ashamed of yourself,"
some participants shouted at Greenspan.

In Washington, Sen. Alfonse D'Amato, a New York Republican who
heads the Senate Banking Committee, said Congress must insist on
"discipline and thoughtful action" before taxpayer dollars were
put at risk in Asia.

He said his panel would investigate the bailouts immediately
after Congress reconvened on Jan. 26.

The stepped-up attacks on the IMF come as Deputy U.S. Treasury
Secretary Lawrence Summers met with Asian leaders during a week-
long tour of the battered region. On Monday, Summers was in
Indonesia, currently the focus of market anxiety after the rupiah
nose-dived last week and stocks faced heavy selling.

The IMF has put together huge bailouts for South Korea,
Thailand and Indonesia since the July 2 crash of the Thai baht,
which sent shock waves across Southeast Asia. The United States
and other rich countries have agreed to contribute billions of
dollars to support IMF-led rescues.

When it reconvenes, Congress will be asked to make an extra
$3.5 billion available to the IMF for an emergency lending
facility and around $15 billion to cover the U.S. share of a
quota increase to replenish IMF funds.

The Clinton administration said that the money was needed to
keep the IMF strong and that U.S. economic and national security
interests were at stake in Asia.

Opponents argue that American taxpayers should not be forced
to prop up countries responsible for their own financial problems
and that IMF policies are too harsh and will not work.

Forbes said members of Congress should "say no" to the
"economically destructive" IMF. "Its austerity policies of
devaluation and higher taxes are making the Asian economic crisis
worse," he said.

Like Forbes, Jack Kemp, the unsuccessful Republican vice-
presidential candidate in 1996, has urged Congress to withhold
the IMF funds.

"I don't think that Congress should bail out Asia until we do
a couple of things," Kemp said on NBC television on Sunday. "No.
1, require that the IMF change its policies."

Kemp and is also considering a presidential bid in 2000.
D'Amato said he expected Treasury Secretary Robert Rubin and
other senior officials to justify the bailouts to Congress.

"When Congress resumes we will ask the secretary of the
Treasury and the appropriate officials to explain to us and to
the American people what various courses of action they will be
recommending," he said in a statement.