An article in IPS News about a steel plant in Bulgaria where privatization was a failure brought back thoughts about the International Monetary Fund (IMF).

IPS reports that, "The steel plant at Kremikovtzi, the pride of Bulgaria in its socialist days, is nearing collapse after privatisation failed to deliver.

"Kremikovtzi was privatised in 1999, when 71 percent of its shares were sold for one dollar to the mostly Bulgarian owned Finmetal Holding. In 2005, Finmetal was acquired by GSHL.

"A worker from Kremikovtzi told journalists that improvements have been made on the outside of the plant and to make equipment look new, but that inside facilities are rotting.

After the breakup of the USSR and Yugoslavia and the collapse of communism in Warsaw Pact countries last decade, the IMF and World Bank went charging into Eastern Europe with their banners of privatization and deregulation waving.

The IMF strategy also unleashed a wave of corruption by those getting in on the corporate privatization and deregulation action.

Joseph Stiglitz, eminent economist, criticized the IMF as "secretive, undemocratic and indifferent to the poor."   He was a chief economist and senior vice president at the World Bank from 1997 to 2000.  Stiglitz was told to tone down the criticism or resign.  He resigned.

An article about Mr. Stiglitz explains, "It [the IMF] preaches the gospel of free trade to developing countries-even though most Western countries built their economies by protecting certain industries and continue to subsidize some domestic producers. The blind push to privatize and deregulate has not only failed to fuel sustainable development, Stiglitz contends, but reflects an idealized vision of how markets function that neither economic theory nor concrete experience supports.

"The IMF demanded fiscal austerity in Argentina, where unemployment had reached 20 percent and, in December, sparked riots that led to the government's collapse."

No wonder Argentina told the IMF goodbye and don't let the doorknob hit you in the butt on the way out.

The article continues, "When the IMF called on South Korea and other crisis-wracked nations to raise interest rates and cut spending as conditions for receiving loans, however, his frustration reached the boiling point. The IMF claimed these austerity measures would stabilize local currencies and restore investor confidence (not coincidentally, many of these investors might also be bailed out). But in meetings with top IMF officials, Stiglitz pointed out that most East Asian nations already had balanced budgets and high interest rates.

"Stiglitz denounced the IMF's response to the Asian crisis as an abject failure. "Who is paying the price?... Workers who are going to be put out of jobs." Unemployment indeed increased fourfold in Korea, threefold in Thailand and tenfold in Indonesia, where cuts in food subsidies sparked riots.

"Today, of course, most of the affected countries have recovered, leading the IMF's defenders to argue that in the end, its prescriptions worked. "In the countries where IMF guidance was followed promptly and without fail, recovery was faster," argues MIT's Rudiger Dornbusch. Not so, counters Stiglitz: A study by Dani Rodrik found that nations that defied the IMF and kept interest rates low, such as Malaysia, recovered more quickly than those that heeded its advice, such as Indonesia."

Even now, the IMF is attempting to polish its terrible image in Asia after the financial damage it caused in the 1990's.

As the article states, "To some degree, the mounting criticism from Stiglitz and other quarters has had an impact. IMF officials recently acknowledged the, potential risks of capital market liberalization, and both the IMF and World Bank have begun speaking more openly about debt relief and poverty reduction. But while the rhetoric has changed, Stiglitz maintains that a doctrinaire ideology of 'free-market fundamentalism' continues to shape policy."

As Stiglitz asserts, it's time to end "the World Bank and IMF's fifty-year monopoly on development policy."  The IMF has caused enough worldwide damage with its dogmatic and perverse policies.