Daily Archives: 24 April 2026

Mistake

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President Donald Trump (R) is pushing Congress to include in its next budget enactment a 50% increase in the US quota contribution to the IMF, a dollar increase of some $55 billion.

The mistake is in this:

the cost to US control over IMF resources, which Treasury conceals with its claim in the budget that the “equiproportional” quota increase “would be fully offset by a reduction in” the use of debt, “all of which will keep the IMF’s overall lending capacity constant.” What Treasury doesn’t disclose is the hit to US power when the IMF gets more of its resources from equity than debt.

That hit comes from voting on IMF lending which depends on the fund’s use of debt via New Arrangements to Borrow which it does in order to raise lendable monies. This is loosely akin to a bank’s need for extending savings accounts to customers in order to raise funds to lend to other customers.  It takes approval by 85% of IMF voting shares for the IMF to borrow, and the US has had, heretofore, 16% of the voting shares, giving us veto power over IMF’s borrowing.

So long as the IMF has to borrow to lend, the US can exercise a large measure of control over IMF lending. But the US quota increase would shift the IMF’s ability to lend to those quota funds, and with that shift, the US would lose its current voting veto power, IMF could lend without serios oversight.

One upshot of all this, if it is passed, is an increase in the People’s Republic of China’s ability to borrow from the IMF and thereby to prop up its own internal excessive borrowing. And helping out an enemy nation like that is a very serious mistake.

What are they Going to Do about It?

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The Wall Street Journal opened its house editorial with this:

The gerrymander race to the bottom escalated on Tuesday as Democrats in Virginia won a narrow victory to redraw their state map to add as many as four Democratic House seats. This is bad news for GOP control of the House in November, but Republicans can also blame President Trump for starting this rolling rock that has now come down on their heads.

Say that’s true—and it likely is. It’s also true, though, that Texas was pressured by the courts to redraw its Congressional district maps because, those courts had decided, the then-just-drawn map was overly racially gerrymandered. However, the State’s Republican-led legislature didn’t need to redraw its map the way it did, if the goal was only to correct a court-claimed racial mistake.

At bottom, though, the question is, So what? This is where the Republicans are, regardless of how they got here.

What are they going to do about it? Wasting time, energy, and resources pointing fingers is time, energy, and resources they should be putting into unifying their party and dealing constructively with the situation—national as well as local—as it is. That begins with individual candidates getting out among their constituents, Left, Right, and Center, and talking directly to them about the candidates’ concrete policies and how those are better than the Progressive-Democrats’ and how each Republican candidate’s policies will directly benefit each set of constituents.