Strauss Kahn's proposed reforms while providing a "human face" to the IMF did not constitute a shift in direction. They were formulated within the realm of neoliberalism. They modified but they did not undermine the central role of IMF "economic medicine". The socially devastating impacts of IMF "shock treatment" under Strauss-Kahn's leadership have largely prevailed.
Dominique Strauss Kahn arrived at the helm of the IMF in November 2007, less than a year prior to September-October 2008 financial meltdown on Wall Street. The structural adjustment program (SAP) was not modified. Under DSK, IMF "shock treatment" which historically had been limited to developing countries was imposed on Greece, Ireland and Portugal.
Under the helm of DSK as Managing Director, the IMF demanded that developing countries remove food and fuel subsidies at a time of rising commodity prices on the New York and Chicago Mercantile exchanges.
The hikes in food and fuel prices, which preceded the September-October 2008 Wall Street crash, were in large part the result of market manipulation. Grain prices were boosted artificially by large scale speculative operations. Instead of taming the speculators and containing the rise in food and fuel prices, the IMF's role was to ensure that the governments of indebted developing countries would not in any way interfere in the "free market", by preventing these prices from going up.
These hikes in food prices, which are the result of outright manipulation (rather than scarcity) have served to impoverish people Worldwide. The surge in food prices constitutes a new phase of the process of global impoverishment.
DSK was complicit in this process of market manipulation. The removal of food and fuel subsidies in Tunisia and Egypt had been demanded by the IMF. Food and fuel prices skyrocketed, people were impoverished, paving the way towards the January 2011 social protest movement:
Fiscal prudence remains an overarching priority for the [Tunisian] authorities, who also see the need for maintaining a supportive fiscal policy in 2010 in the current international environment. Efforts in the last decade to bring down the public debt ratio significantly should not be jeopardized by a too lax fiscal policy. The authorities are committed to firmly control current expenditure, including subsidies,... (IMF Tunisia: 2010 Article IV Consultation - Staff Report; Public Information Notice on the Executive Board Discussion; and Statement by the Executive Director for Tunisia)
"[The IMF] encouraged the [Egyptian] authorities to press further with food and fuel subsidy reforms, and welcomed their intention to improve the efficiency and targeting of food subsidy programs. [meaning the selective elimination of food subsidies].
"Consideration should be given to introducing automatic adjustment mechanisms for domestic fuel prices to minimize distortions [meaning dramatic increases in fuel prices without State interference], while strengthening cash-based social programs to protect vulnerable groups. (IMF Executive Board Concludes 2008 Article IV Consultation with the Arab Republic of Egypt Public Information Notice, PIN No. 09/04, January 15, 2009)
Under the helm of DSK, the IMF also imposed sweeping austerity measures on Egypt in 2008, while supporting Hosni Mubarak's "efforts to broaden the privatization program".(Ibid)
The Frank G. Wisner Nicolas Sarkozy Connection
Strauss-Kahn was refused bail by Judge Melissa Jackson, an appointee and protégé of Michael Bloomberg, who in addition to his role as Mayor is a powerful figure on Wall Street.
Manhattan District Attorney Cyrus Vance Jr. charged (using scanty evidence) Strauss-Kahn "with seven crimes, including attempted rape, sexual abuse, forcible touching and unlawful imprisonment".
Who is Cyrus Vance Jr.?
He is the son of the late Cyrus Vance who served as Secretary of State in the Carter administration.
But there is more than meets the eye. Nicolas Sarkozy's step father Frank G. Wisner II, a prominent CIA official who married his step mother Christine de Ganay in 1977 served as Deputy Executive Secretary of State under the helm of Cyrus Vance Senior, father of District Attorney Cyrus Vance Junior.
Is it relevant?
The Vance and Wisner families had close personal ties. In turn Nicolas Sarkozy had close family ties with his step father Frank Wisner (and his half brothers and sisters in the US and one member of the Wisner family was involved in Sarkozy's election campaign).
It is also worth noting that Frank G. Wisner II was the son of one of America's most notorious spies, the late Frank Gardiner Wisner (1909- 1965), the mastermind behind the CIA sponsored coup which toppled the government of Mohammed Mossadegh in Iran in 1953. Wisner Jr. is also trustee of the Rockefeller Brothers Trust.
While these various personal ties do not prove that Strauss-Kahn was the object of a set-up, the matter of Sarkozy's ties to the CIA via his step father, not to mention the ties of Frank G. Wisner II to the Cyrus Vance family are certainly worth investigating. Frank G, Wisner also played a key role as Obama's special intelligence envoy to Egypt at the height of the January 2011 protest movement.
