Veronica Brown ’17
Contributing Writer
Following President McCartney’s tweet announcing Christine Lagarde as Smith’s 2014 commencement speaker on February 13th, conversations about “Forbes” magazine’s seventh most powerful woman and the International Monetary Fund (IMF), which she directs, have been inescapable around campus. As many students debate the implications of the IMF and its first female Managing Director, others are left wondering: why are Christine Lagarde and the IMF important?
The IMF was founded at the Breton Woods Conference after World War II to create global economic stability after the war. According to the IMF’s website (imf.org) the organization’s current main functions are to promote “international monetary cooperation and exchange rate stability… balanced growth of international trade, and [to provide] resources to help members in balance of payments difficulties or to assist with poverty reduction.” In other words, the IMF collects data about the global economy and uses it to provide policy suggestions to member counties in need of economic counsel. The organization also loans countries money under the condition that the country follows the IMF’s economic policy advice.
No one doubts that Lagarde is one of the most powerful women in the global economy after her 2011 appointment as Managing Director of the IMF, but the controversy comes with the question of whether she’s using her power to advance the interests of women and those in the developing world. In September of 2013, the IMF released a discussion note titled “Women, Work, and the Economy: Macroeconomic Gains from Gender Equality.” Although the note shows the IMF is beginning to pay some attention to the role of gender in economic growth, critics argue that the IMF ignores social equity in favor of economic development. Their criticism lies in the IMF’s Structural Adjustment Policies, which countries must accept to receive loans. Often these policies include austerity measures that require cuts in government services including education, healthcare, and other social services.
Smith Economics professor Mahnaz Mahdavi offers the explanation that these cuts illustrate the necessary tradeoff between a difficult period short-term adjustment in exchange for long-run benefit. Professor Mahdavi cites the IMF’s recent publication on gender and Lagarde’s numerous speeches and writings about women’s vital role in the global economy (Christine Lagarde, “Dare the Difference”, June 2013, IMF’s Finance & Development magazine; Christine Lagarde, “Women and the World Economy”, 9/24/13, project-syndicate.org) as evidence that Lagarde has “brought gender equality to the forefront of the discussion about economic growth.”
Smith Sociology professor Payal Banerjee teaches the class “Gender and Globalization” which examines how international financial institutions contribute to a variety of global issues. She points out the note on gender will not hold real meaning if the actual policies recommended by the IMF continue to harm the women of the world. In response to the argument that people should support Lagarde as commencement speaker because she is a powerful woman, regardless of the policies of the organization she runs, Professor Banerjee argues it is difficult “to separate the individual from the institution” because the IMF hired Lagarde to represent its mission.
If a student is interested in learning more about the effects of the IMF Professor Banerjee suggests The Bretton Woods Project’s website, which describes itself as providing “critical voices on the World Bank and IMF” and examines the IMF’s policy recommendation by both world region and topics, including gender.
