Canada’s finance minister Ralph Goodale spoke to reporters following the G7 finance ministers meeting hosted by Gordon Brown of the U.K. last weekend. Canada caught its share of the blame from British officials for killing Brown’s plan to write off African debt. But Ralph struck back: all the British want to do is take from Peter to pay Paul.
Remember those two names; they are crucial to understanding why Canada lined up to ensure more Africans become poorer, and die earlier, as a result of the international monetary fraud being perpetuated by the money men of the West, plus Japan.
Peter is Peter Munk of Barrick Gold, advised by Brian Mulroney, and former Bank of Canada chief John Crow. Paul, is Paul Martin Sr., identified with the liberal internationalist wing of the Liberal party which, at its best, championed multilateral institutions such as the UN and the International Monetary Fund (IMF), and his son, the very right wing former finance minister who as prime minister has continued to undo his fatherâe(TM)s works.
Paul Jr., through Ralph, is helping Peter Munk rob the Liberals, and the world, of what remains of the liberal internationalism dear to Paul Sr.
Believe it or not, the IMF was created to be a credit union for states. The idea was simple. All nations trade. Some take in more money than they spend, others spend more than they take in. The first group have surpluses, the second deficits.
Since nations only trade with one another, the world cannot have a trade deficit; therefore, total trade surpluses must equal total trade deficits.
The original role of the IMF was to ensure that money flowed from the surplus countries to the deficit countries so that trade could expand. Otherwise, the deficit countries would have to cut back spending, so as to eliminate their deficits, and the deflationary retrenchment would shrink trade. No country, surplus or deficit, wanted that to happen — the memory of the Great Depression of the 1930s was very instructive — so the IMF was born in I944, to help the world economy to grow.
When the Western central banks precipitated the international debt crisis in the early 1980s by raising interest rates into the high teens and beyond, the IMF was reinvented as the debt collector: evil incarnate for any poor country in debt. But the IMF still has the structure of a credit union, and it could reinvent itself again as the saviour of indebted countries, instead of acting as the arresting officer, judge and jailer for debtor nations.
The key to understanding the current international monetary fraud is that the IMF greatly understates its assets. In effect, it is defrauding the states which make up its membership, pretending it has less money than it has, hiding resources available for lending, or for debt forgiveness.
When the IMF was created, nations were given borrowing privileges, which were called quotas by the Fund. Each country could borrow one-quarter, one-half, three-quarters or all of its quota, subject to approval from the board of the IMF. But each country had to make a deposit in order to activate its membership. One-quarter of the quota was payable, originally only in gold, later in currencies, mainly the U.S. dollar.
So guess what? The IMF is sitting on lots of gold deposits, 103.4 million ounces in fact. But it pretends the gold is only worth today what it was worth when it was deposited with the Fund, about $8.5 billion. But when the IMF gold is valued at market prices it is worth considerably more, about five times more, some $ 42.2 billion when the IMF measured it last, in 2004.
Imagine you are a member of a credit union and the union tells you that you only have one-fifth of the market value of the assets you own as a member. It would be time to change the directors, and give management new orders, right ?
Gordon Brown of the U.K. would like to see IMF gold valued at market prices, so that more money could get to Africa. Canada opposes this. Why?
Canadian gold companies are worried that the IMF will sell its gold and depress the world gold price. These companies operate around the world, so it is not Timmins we are talking about protecting. Rather, it is the owners of the companies, people like Munk who have friends such as Mulroney and Crow, who not long ago went on a well-paid tour of capitals to explain why gold was not worth what the market said it was worth.
So, there is to be found the real tale of Peter and Paul. Paul is protecting Peter, so Barrick Gold can become richer. As well, Paul is betraying his father Paul’s legacy of liberal internationalism; this Canadian government insists the poor people of the world be denied access to the value of the assets they own through their governments. The world is poorer as a result.
The ideal of the earlier era, that the strong countries need to change their policies to assist the weaker countries, is still valid. It is the Liberal government that has abandoned the world’s poor, and the ideals of Paul Martin Sr., Lester Pearson, and the Canadian liberal internationalists. Canadians are poorer as a result.