Opening Statement of
Rep. Paul E. Kanjorski
House Committee on Banking & Financial Services
Hearing on the Asian Financial Crisis and IMF Funding
January 30, 1998
Thank you, Mr. Chairman, for allowing Members of Congress to examine the important issues at stake in the Asian financial crisis and IMF funding in such a bipartisan and considered manner.
Over the last few months the whole world has been shocked by the rapidity with which this crisis engulfed Asia. Although this problem may seem distant from the real lives of my constituents in Pennsylvania, it is by no means certain that this will remain the case. In todays integrated market, economic contagions can spread as quickly as the electronic signals that facilitate information and currency mobility. Fortunately, up until this point the U.S. market has experienced relatively little damage from the Asian crisis.
In order to ensure that this damage remains limited, we must focus on making the IMF and the world economic community as effective as possible in dealing with global crises. I am sure that all my colleagues gathered here today are intent on finding new and better ways to protect the health and vitality of the U.S. and global economies. At the same time, we must consider not only the macroeconomics effects of our policies, but also the effect on the average person. IMF policies must not degrade labor conditions or deflate wage rates that could devastate these countries and lead to more unfair competition to American labor. How can we ensure that the restructuring needed to stabilize many East Asian economies does not fall on the shoulders of the poorest and most marginalized?
We must also endeavor to make sure that those who precipitated this crisis pay their fair share in solving it. Every effort must be made to force real change in these Asian economies that will prevent a repeat of todays problems in the future.
In addition, I hope the witnesses will address the advantages and disadvantages to the government and taxpayers of the United States of acting as a part of a multi-lateral organization like the IMF, as opposed to taking unilateral action through such mechanisms as the Exchange Stabilization Fund as was done in the Mexican financial crisis. I also hope our witnesses will report on the final impact of the Mexican financial crisis on the Mexican and U.S. economies, and on U.S. taxpayers.
Mr. Chairman, these are important issues for this Congress to address. I look forward to the testimony of this august panel of witnesses.