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Columns
Opinion articles written in the style of their author. These texts are to be based on verified facts and must be respectful towards people, even though their actions may be criticized. All opinion articles written by individuals from outside the staff of EL PAÍS shall feature, along with the author’s name (regardless of their greater or lesser renown), a footer stating their office, academic title, political affiliation (if any) and main occupation, or the occupation related to the topic being assessed

IMF quake: the lessons

The International Monetary Fund (IMF) has just been shaken by two seismic shocks, highlighting some important facts about how the system works

The only good thing about earthquakes is that they teach us things about our planet's deeper geology. The International Monetary Fund (IMF) has just been shaken by two seismic shocks: the arrest of its director, Dominique Strauss-Kahn, and the controversy about who is to replace him. The latter has highlighted important facts about how the system works. Some of these facts we already knew; others throw new light on the shifting realities of power.

There are two interesting lessons to be gleaned from the near-certainty that the next head of the IMF will be the French minister Christine Lagarde. The selection process is still going on, and it may be that some obstacle will stand in her way. I doubt it. So do most well-informed observers. I was invited to IMF headquarters in Washington to speak on this subject to more than 100 officials and executives of the institution. I began my talk by asking for a show of hands of those who thought that Mme Lagarde would not be selected for the post. About 10 people raised their hands. In other words, an immense majority of observers already believe they know the result.

The problem is not whether Lagarde has the qualifications to head the IMF or not (I believe she does), but the unacceptable nature of the process. As we know, in 1944 the US and Europe agreed that the head of the IMF would always be a European, with an American to be in charge of the World Bank. No one else can opt for these jobs, and the irrationality of the thing is growing more obvious. In 2008 the G20 leaders agreed that the heads of these bodies would be chosen in an "open, transparent and merit-based" process. In practice, however, nothing has changed. From this we can gather the first lesson offered by the IMF process: the pursuit and retention of power tends to displace the defense of values and principles, and even common sense.

For all the eloquent statements and emphatic promises, and the acrobatic attempts to make the process seem more open and meritocratic than it really is, the agreement signed in the colonial era still stands in the 21st century: Europe will remain at the head of the IMF. Again, the problem is not Europe; the problem is how the IMF head is selected. Europe still has a lot of votes in the IMF, and uses them. Period. Its percentage has diminished but is still high, being based on the continent's weight in the world economy in 1944. And this inherited power is used by Europe to protect, in private, privileges that it publicly denounces. The basic rule is that when it is a question of power, words don't matter; guns, resources, or, as in this case, the percentage of votes that you have do. The rest is rhetoric and distraction.

Another lesson that emerges is that the new centers of world power are still more potential than real. The BRICS group (Brazil, Russia, India, China and South Africa) are making great efforts to appear before the world as an alliance representing a new pole of economic and political power. In theory, the chance to coordinate their positions regarding the designation of the new IMF chief was an ideal opportunity to show that this new force is capable of acting in concert. But the BRICS did not manage to do this, and did not even give it a serious try. For example Brazil, the Latin American leader, could not work up sufficient enthusiasm to support the highly competent Mexican candidate. Nor did the other countries show much interest in putting an end to the offensive US-Europe agreement.

No doubt, the world has new centers of power. But in this case they were unable or unwilling to exercise it in the concerted way that Europe did. The other lesson of the IMF quake is that while each of the BRICS has increased its individual power, as a group they cannot find their way to unified action. If one day they do, we shall be looking at a different world.

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