It is July, and Adam Lerrick is on a roll. The conservative
Carnegie Mellon economics professor and adviser to the US Congress
is saying that Brazil is no different to United Airlines: in
neither case should public money bail out private creditors. Brazil
is "a political problem which has economic consequences" he says,
and although the Brazilian people are perfectly free to elect a
leftist as president, it's not the job of the IMF to step in and
provide enough money to minimize those consequences.
"The new IMF, the new US Treasury, no longer have any sympathy for
the idea of large-scale bailouts," Lerrick says. If and when the
next Brazilian administration starts implementing fiscally
responsible policies of its own accord, then and only then should
the IMF step in to help reduce the cost that ordinary Brazilians
must pay.
Three weeks later, the new IMF is a...
