Accountabilities and Accountings: some notes on the IMF and the ‘Greek Debt Truth Commission’

Picture by Global Justice

Over the last 40 years the International Monetary Fund (IMF) has played a leading role in both the development of neoliberal economic knowledges and their global spread as social and economic policy. Through various kinds of conditional loan agreements that provide financial assistance to nation-states in return for their adoption of “market-friendly” policies, including privatisation, deregulation and integration into the global market, the IMF has tethered us all to a mode of accounting that makes us accountable to the market in absolute and existential terms. Its approach has led sociologists such as Pierre Dardot and Christian Laval to call it one of the “disciplinary institutions” of neoliberal globalisation (i), remaking social relations in the image of the market through a mixture of incentives and punishments. 

The latest iteration of the organisation’s disciplinary power emerged in the wake of the 2008 global financial crash, particularly in its interventions in Greece which have required successive governments to undertake austerity programmes designed to make the economy ‘sustainable’ in return for financial support. The reality is that ‘sustainability’ was a euphemism for implementing what were figured as critically or existentially necessary economic policies that would enable Greece to repay its debts, whilst simultaneously externalising and ignoring the social costs of doing so. Even if we put the questionable economic assumptions that motivated these decisions aside for now, it remains clear that the IMF’s abandonment of its accountability to ‘the social’ led to severe poverty, deprivation, and social unrest. For example, between 2009-2014 severe material deprivation in Greece rose from 11% to 21.5% of the population, and the poorest 10% of the populations lost 56.5% of their income (ii). 

That all said, anyone who has been keeping an eye on the IMF’s activities might have noticed that this bastion of neoliberalism appears to be undergoing an identity crisis. There has been a curious and not insignificant renunciation of neoliberalism at the level of optics at least. In 2013, the IMF admitted it had failed to understand the social and economic costs of its interventions in Greece (iii). If austerity measures were first understood to be necessary to keep the Greek economy and, more broadly, the Eurozone from collapse, then this was something of an admission that these measures completely failed the Greek economy with terrible social costs. Then, perhaps more significantly, in July 2016 the IMF published a report titled “Neoliberalism: Oversold?”(iv)  that rebuked the very neoliberal economic policies which had been central to the IMF’s policy interventions across the globe. Indeed, it argued that ideas which had become all but “common sense” had not resulted in the predicted glut of economic growth and only served to make very few people better off. 

Nevertheless, we should be extremely dubious about any claims that these admissions signal a departure from the ways of thinking and acting which have defined the organisation for so long. After all, in the 3 years between its first mea culpa and the second, there was a determined (and ultimately successful) attempt to force Greece to cut more spending for the sake of ‘sustainability’. And it was only a few weeks ago that the Times reported that the IMF believes the cost of Brexit may require the wholesale privatisation of the NHS in order to balance the books (v).  It’s difficult to see how this latest intervention constitutes anything but the re-summoning of the very forms of accounting and accountability that the organisation rebuked itself for earlier.

Even as the IMF’s pays lip service to the growing discreditation of neoliberalism whose promise of ever-lasting growth and increasing standards of living appears more and more mythological, it also seems very capable of avoiding a reckoning with itself that would necessitate a penetrative transformation of its knowledge and practices. What to make of this? What does it mean if the IMF is able to occupy discourses against neoliberalism whilst simultaneously spreading and intensifying its social order? 

By framing the problem in this way, what I hope to point to is the fundamental lack of accountability that both neoliberal institutions and the knowledges they wield have to the social worlds they act upon. From this perspective, a key issue is thus to identify resources that might be drawn from, or indeed, developing new tools, that can hold neoliberalism to account. In other words, how might we develop a different form of (social) accounting that holds neoliberal knowledges accountable to the societies they transform? 

Picture by Nagarjun Kandukuru

In thinking about this question, I have become increasingly interested in what has been called the Greek Debt Truth Commission (GDTC). The GDTC was set up by the Greece’s left-wing SYRIZA government during the crisis of 2015 as the Troika (made up of the IMF, the European Commission, and the European Central Bank) were forcing Greece make further public spending cuts to repay its debts and become economically ‘sustainable’. The Commission was tasked with developing legal arguments regarding the cancellation of Greece’s debts as part of the SYRIZA government’s strategy of avoiding making further cuts to Greek social spending. It involved analysing official documents including contracts, memoranda, and annual reports as well as extracting witness testimonies in order to challenge the legal standing of both the debt and the immiserating conditions attached to it. 

Although the work of the GDTC was cut short for political reasons, in its short life it managed to release a preliminary report (vi) which argued from a legal standpoint that Greece could not and should not cave to the demands of the Troika. It shed light on the dubious foundations upon which Greek debts were accumulated, and, crucially, argued that the conditions attached to many of them (social spending cuts) resulted in the violation of the civil, political, social, and economic rights of Greek citizens. On this basis the report concluded that the debt was illegal, illegitimate, and odious under international law.

There are some important things about this process that I think could be learnt from. Most of all, I am interested in the GDTC as an exercise in knowledge-making that attempts to reinsert the ‘social’ which the IMF had externalised from its own economic accounting. There is a distinct attempt to produce knowledges which articulate the social costs of making states and their citizens accountable to nothing but an economic balance sheet. On this front, an important aspect of what the GDTC tried to do lies in its appropriation of legal mechanisms and arguments which allowed it to develop its own form social accounting. Through legal discourses it could constitute something of a balance sheet in which specific debts were set against their damaging and ultimately illegal social effects. In doing so, the GDTC constructed a discourse of accounting that enabled what were, in the end, political arguments about the social consequences of austerity to be grounded in the legitimacy and, in theory at least, force of the law. 

Of course, the potential of practices like the GDTC is limited by the critical mass of support that enables them to be wielded effectively. They need to be part of broader social movements and must help them to achieve their goals. But at a time when neoliberalism is failing to deliver the goods it has promised us perhaps now signals a time when tools like the GDTC can be useful. 

Notes

(i) Dardot & Laval (2013) The New Way of the World: On Neoliberal Society. London and New York: Verso 
(ii) GDTC (2015) Preliminary Report. Retrieved August 2015, 1, from http://cadtm.org/Preliminary-Report-of-the-Truth, p. 40
(iii) https://www.theguardian.com/business/2013/jun/05/imf-underestimated-damage-austerity-would-do-to-greece 
(iv) http://www.imf.org/external/pubs/ft/fandd/2016/06/ostry.htm 
(v) https://www.thetimes.co.uk/article/privatised-nhs-and-tax-rises-forecast-by-imf-h969qgjmb
(vi) GDTC, Preliminary Report.

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The Frankfurt Skyline where fetish priests manipulate the commodity markets (photo by Thomas Wolf "Der Wolf im Wald")

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Read the article for free here.