The IMF Should Act Now to Assist Low- and Middle-Income Countries

“Not all governments can snap their fingers and magically afford an emergency health response, let alone provide a basic income to cover citizens’ daily needs. That is the privilege of the US and its sturdy, tradable currency." David Adler and Andrés Arauz wrote in The Nation about the urgent need for the IMF to issue 3 trillion in Special Drawing Rights to assist Global South countries in a coronavirus-caused global economic downturn.

“The US government’s dollar support is not merely an act of solidarity; it preserves the stability of the global financial system,” Arauz says in a press release. “Financial panic in one part of the planet may infect the rest.” Arauz also discussed the appeal for #3trillionSDRnow in an interview with The Real News.




“The empowerment of Steve Mnuchin to utilize the Fed’s magnified buying powers to pick winners and losers is unprecedented in American history.”

Since the last CEPR News, the CARES Act has become law. This is the third pandemic emergency relief package since March 6. Eileen Appelbaum and Shawn Fremstad updated CEPR’s handy chart on what the bills include and what they still need. But CEPR’s work isn’t done just because the CARES Act is a done deal.

The three pandemic relief bills have focused CEPR’s work on two fronts. One, to continue to advocate for effective policies to mitigate the pain this crisis is causing people. Two, to vigilantly call out misuse of those funds.

Although there are relief provisions that will genuinely help those in desperate need, there are still trillions of dollars in Federal Reserve loans to be distributed under the direction of Treasury Secretary Steven Mnuchin, which is akin to, in the words of Jeff Hauser of CEPR’s Revolving Door Project, “facilitating a corporate coup ... He will have $4.2 trillion to extend to would-be corporate allies.”

The corporate vultures were circling before the ink was dry on the CARES Act, reports Eileen Appelbaum and Rosemary Batt. That same day the Act was signed, a private equity-owned hospital chain demanded, and received, emergency funds to bailout a hospital that was driven into financial distress by the very design of the PE business model - not because of pandemic-related overload.

Beyond the immediate focus on containing the virus and finding the necessary resources to treat people, CEPR is focused on policy responses that Congress should take during this crisis.

There is plenty of room for more economic policy options that can mitigate the impact of tens of millions of people losing their jobs, as Dean Baker explains here and here.

There is still not enough help for state and local governments, as economist Max Sawicky lays out here.


“Sanctions have severely limited [Iran’s] access to medicines and medical supplies”

“The Haitian government has few fiscal resources to draw upon in responding to the coronavirus pandemic, and Haitian families, many already pushed to the edge, are facing an increasingly perilous future,” Jake Johnston and Kira Paulemon write for Haiti: Relief and Reconstruction Watch.

Trump’s sanctions are making the coronavirus pandemic in Iran worse, and will likely hurt the ability of countries like Venezuela and North Korea to respond more effectively. Members of Congress should support Rep. Ilhan Omar’s bill that would curb executive branch use of sanctions, Alex Main writes at Al Jazeera English.

As Cuba sends doctors abroad to fight the coronavirus, “The [US] embargo has...negatively affected Cuba’s healthcare system by blocking imports of life-saving drugs and medical equipment patented in the United States,” Alex Main writes in the latest issue of the NACLA Report on the Americas.