Will Strauss-Kahn Sex-Assault Charge Spark Global Power Shift?

Developing nations have pushed for years to end the 50-year European monopoly on the IMF's top job. An African maid's accusations could finally open the door.

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Imagine that you're one of the most powerful men on the planet, flying first class to Paris on Air France out of the pristine and elegant Terminal 1 at John F. Kennedy Airport in New York. Then imagine cops barging into the champagne-and-cashews atmosphere of the first-class cabin just before the doors shut to escort you off the plane. You're being arrested to answer charges that you raped an African immigrant who is a maid while you were at a hotel in New York City. In moments, your aspirations to be the next president of France have evaporated.

The woman that French politician Dominique Strauss-Kahn is accused of assaulting sexually in a hotel suite is from Senegal and has a 9-year-old daughter, according to news reports. The Daily News interviewed the brother of the West African woman, himself manager of a Harlem café.  "She's very upset because she loves her job," said the 43-year-old brother, whose name the Daily News is withholding to protect the identity of the woman. "She's a wonderful, hardworking woman."

Some would see ironic justice if an African woman triggered the downfall of the powerful head of the International Monetary Fund, which oversees the global currency system and controls lending to poorer nations -- and accelerated a shift  in power at this key financial institution from Europe to developing countries.

For years the IMF has held sway over dozens of African nations and other developing countries through its economic policies. In exchange for loans, the fund has often played the heavy, pressuring national leaders to impose stringent austerity measures to balance their budgets and pay off their debts. The IMF typically demands cutbacks in social services, medical facilities and education, reductions in government employment and postponements of infrastructure projects. In essence, the poorest populations in developing countries are hit by this belt-tightening.

Critics have long pointed out that the
IMF has few successes to show for its tactics. In fact, the critics say, IMF policies invariably slow down a struggling country's economy and plunge it into deeper recession than before the fund's intervention. In 2009, the United Nations reported that the net flow of money from the world's least-developed countries to the most developed totaled $568 billion (pdf).

For the first time since the end of World War II, European countries in financial trouble from the global recession, such as Greece, Ireland and Portugal, are now experiencing the consequences of these severe economic measures. Since IMF measures were implemented by Athens last year, Greece has lost 150,000 jobs, and its debt has shot past 150 percent of GDP.

Critics say tha tthe IMF's main role is to ensure that Western banks get paid. But Argentina famously recovered from severe economic problems in 2001-2002 by rejecting IMF formulas and defaulting on its debt. Argentina spent its way out of debt and now has one of the strongest economies in the developing world.

Not surprisingly, Strauss-Kahn's unexpected downfall has triggered renewed pressure from the so-called BRIC nations (Brazil, Russia, India, China) for a greater voice in the affairs of the IMF and its partner institution, the World Bank. An informal agreement after World War II, when the institutions were created, requires that the IMF be led by a European and the World Bank by an American. The emerging powers pushed hard at the bank's spring meeting in Washington last month and will have another opportunity, if -- as expected-- Strauss-Kahn resigns and the top job is open once again. The developing world would owe a debt to an unnamed African woman willing to stand up to one of the most powerful men in the world.

For more on Strauss-Kahn's arrest, read Eugene Robinson in the Washington Post.

For more on the impact of the arrest on the  IMF, visit Foreign Policy.

Joel Dreyfuss is The Root's managing editor.

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