Bailout for whom?

• Position: US and Intl Monetary Fund bailouts of Thailand, South Korea, Malaysia, and Indonesia are undemocratic and will cause undue suffering among citizens - Column

The bailouts of South Korea, Thailand, Indonesia, and Malaysia by the International Monetary Fund (IMF) and the U.S. government are cruel and undemocratic.

Cruel, because those who will suffer are not the banks that recklessly lent money to these countries but the millions of citizens in these countries who will now have to bear the IMF's yoke, with unemployment on one side and higher prices on the other.

Undemocratic, because the U.S. decision to bail out these countries came without a Congressional appropriation of funds. Undemocratic, because the IMF seizes economic sovereignty from these nations.

In South Korea, a democracy, the IMF and international investors twisted the arm of the newly elected president, Kim Dae Jung. During his presidential campaign, he criticized the IMF agreement and promised to renegotiate its terms and postpone any mass layoffs for six months. But Kim Dae Jung changed his mind as soon as he was elected, because the IMF and big foreign investors made it clear to him that that they would take their money and go home if he didn't get down on his knees and take his punishment.

The punishment will be harsh. Unemployment is expected to double or triple in the next year, with as many as one million South Koreans thrown out of work--this in a nation that has virtually outlawed layoffs. The price of basic goods, like sugar and flour, is skyrocketing. Living standards are plummeting.

But the IMF doesn't care. It sees itself serving two functions acting as the collecting agent for foreign banks, and as a battering ram for new foreign investors. It insists that the country cut back on the public sector, and it has successfully demanded that South Korea lift restrictions on foreign ownership. A single foreign investor can now own 50 percent, instead of 7 percent, of a South Korean company. So now there is a garage sale on South Korean companies, and U.S. companies are ready to take advantage of the bargains.

This subversion of South Korean sovereignty is especially poignant since it's occurring with Kim Dae Jung's begrudging cooperation. For two decades, Kim Dae Jung has been the leading dissident in South Korea. He was imprisoned for six years and survived both a death sentence and several assassination attempts. Through it all, Kim Dae Jung stood for democracy and for workers' rights. On December 18, he triumphantly accepted the presidency. But within hours, he was forced to give up the power to govern his country's...