Mr H. Benn (the ‘Overseas Development’ minister) has announced that the British government will withhold £50 million (US$ 94 million) of taxpayers money that it was to pay to the World Bank to be lent out to ‘Third World’ governments.
Mr Benn said this was protest against the World Bank’s policy of demanding free trade and privatization in return for loans. Actually the World Bank does not do that very much any more. These days it normally just demands that a loan (for example) for education actually be spent on education – rather than go in corruption.
However, I still think the government was right to withhold the money (and not because I am against free trade or privatization – or think that the same economic principles can produce good results in one country and bad results in another, as a weird editorial in the Daily Telegraph claimed), but because I do not believe that taxpayers money should be taken by the government and given to the World Bank.
The World Bank should not exist (and nor should the IMF). If ‘Third World’ governments want state education (or some other folly) they should pay for it themselves – as they will have to after the loan money runs out anyway. All the loan achieves is to give them a debt to pay back on top of the future state education (or whatever) bill.