IC interview with Allan Meltzer, chairman of the Meltzer commission, which studied IMF and World Bank reform

IC Interview: A System in Turmoil

IntellectualCapital.com
Thursday, April 13, 2000
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An interview with Allan Meltzer, chairman of the Meltzer commission, which studied IMF and World Bank reform
http://www.intellectualcapital.com/issues/issue364/item9060.asp

Allan Meltzer is a professor of political economy and public policy at Carnegie Mellon University and a visiting fellow at the American Enterprise Institute. He is a former member of the president's Council of Economic Advisers. In 1998, he was appointed by Congress to chair a commission studying the role and effectiveness of the International Monetary Fund (IMF) and the World Bank. In March of this year, his commission released its finding, in a report widely seen as being critical of both organizations.
This week, on the eve of the IMF and World Bank spring meetings, Meltzer sat down to discuss his view of the global economy -- and the role the fund and bank should play in it -- with IC's Bob Kolasky.

IC: As the IMF-World Bank meetings get their start, the big story in the media will, of course, be the thousands of protesters expected here. What do you think about the protests? Are they a good thing?

AM: They’re mixed. I think the idea that people are protesting against institutions [that] are relatively closed and not very transparent, where their money is being used, they don’t know what it’s being used for, is a good thing. They have read a lot about the corruption and the scandals. I think that’s probably good that there’s a protest for that. A lot of the protesters themselves, however, are a mixed bag.
I mean, some of them are, are outright protectionists, like the labor unions. There are a lot of them around. Some of them are religious groups that are interested in debt relief for the poorest nations. And there are students. It’s spring and it’s a nice day, so there are a lot of people out, skipping, cutting classes, and so it’s a mixed group.

IC: What do you think of the extreme element of the protest -- the people who come and wear costumes, and promote civil disobedience, and talk very negatively about how globalization is killing the world, and that the IMF is the Great Satan -- people who say things like that? What do they do to the level of exchange about the IMF? Do they do a disservice to the movement?

AM: They lower the level of rational discussion because they make a lot of charges that I don’t think they quite understand themselves. There are mixtures of people there. Some of them are people who are protesting against what they call the “Washington consensus,” a policy of openness and trade, and things of that kind. But what they really want to do is not get rid of the Washington consensus. They just want to get a different consensus that they want to impose.
We had some of these people appear before the commission that I chaired, talking about environmental issues. They were mainly good people, with a sincere belief. But they don’t understand that what they’re trying to do is just impose a different view on those people [that they claim to be speaking for] instead of taking the view that, which they sometimes claim to take, we should allow people to decide for themselves in the various countries.
The aim of the IMF should be to make sure that the world is less subject to crises, and if it did that, it would be a good institution that was doing good things. The aim of the World Bank should be to lift people out of poverty, to help them while they’re in poverty, to get them out of poverty. If the organizations did that, then there would be very little to complain about.

IC: Is it fair to say that you think both organizations are trying to overreach their mandates?

AM: There’s no doubt about that. They've overlapped on each other's territory so that there’s no accountability and responsibility. But in addition to the lack of accountability and responsibility, they’ve just gone into doing a lot of things they really don’t know how to do very well.
For example, take structural reform in Russia. Neither organization had experience with that. They had no real methods of reforming the structure. They now come out and say, "Well, once we give the money to the central bank, we do not know what happens to it." That’s true, but it’s disgraceful. There ought to be some system where they do know what happens to the money after it goes to the central bank, hard as that may be.

IC: So what would a better involvement for the IMF in Russia have been?

AM: The IMF should be a liquidity lender so [that] if the Russians had a financial crisis, or some country had a financial crisis and they needed some temporary assistance because markets wouldn’t help them out, then the IMF should be there. The IMF should also be there doing things like making sure that we have accurate information, kind of like the Securities and Exchange Commission does for, for commons stocks and bonds in the United States.
We need somebody to do that for countries. If we’re going to rely on private capital markets, on the capital markets to do the lending in the world, then we need to give them the information so they can make good decisions. But that should be their job.
The World Bank’s job should be to help countries like Russia develop. But in our view, the view of the commission that I just chaired, the way in which they go about this is really very wrong. It’s ineffective by their own measures. Seventy percent of the programs in Africa fail, 50% of the programs overall fail.
And that’s measuring failure and success in a very peculiar way. The bank measures it when they give out the money rather than when they look two or three years down the road and find out, did this actually do what it was supposed to do?

IC: So they fail in part because there aren’t enough strings attached to the money that they give -- or accountability toward the money they give?

AM: Well, we don’t want more strings; there are plenty of strings. The IMF and bank come up with 40, 50, 60 different rules that countries have to follow. Mostly they don’t get followed.
What we would like the countries to do is to say we want to improve inoculations against measles ... we want to inoculate our children against measles. Then the bank would say, "We’ll lend you the money, we’ll give you the money, we’ll give you a grant, and if you’re a very poor country, we’ll give you 90% of the money. You have to come up with 10%. But we’re not going to pay it to you. We’re going to pay it to somebody who does the inoculations, when the inoculations are complete."
"How will we know that?" [they might ask. And we'll say,] "We’re, you’re going to have to hire an auditor who’s going to come in and he’s going to check their arms and see that we actually did inoculate these people, or we actually did put in the sanitary sewers, or we actually did make sure that there was electricity in the houses. Those are projects that we’d see, and we’re going to see that they’re done."
So, we’re going to have effective programs. That’s what we want. And we’re going to cut out the role of the government, where the money goes into the government and who knows what happens to it after that.

IC: Let’s talk specifically about some recent IMF bailouts -- in Korea, Indonesia, Thailand, Russia, Mexico, Brazil. Did those bailouts do more harm than good?

AM: No, that’s hard to say. I don’t think that they did more harm than good. I think that they may not have done a lot of good, but they certainly didn’t do more harm than good.
If we look now, two years, three years after the so-called crisis began, most of the countries are recovering. They’ve, many of them, have passed the level of income that they had before the crisis.
Now, how much do we want to attribute that to what the IMF did, and how much do we want to attribute that to the fact that the United States absorbed large amounts of exports from these countries, and so that helped them? Well, that’s harder to know. Eventually, the researchers will straighten that out and give us an answer to that question, but I don’t think we know at this moment.
What we can say is, that if the IMF were doing its job the way we would like them to do it, those crises would have been much less likely to occur. That is because crises occur for three reasons: One, because countries have an exchange rate that’s wrong, and they try to defend it, so they throw lots and lots of the taxpayers’ money in and usually fail. Second, they have weak banking systems -- because the government doesn’t allow competition in banking from outside, because the banks are under-capitalized, because the government’s used them as a slush fund to reward their friends. And the third thing is because when the crisis comes, the IMF wants to put on all sorts of conditions on these loans, and it takes a long time to negotiate the conditions. And meanwhile, the crisis gets much worse.

IC: And people know the IMF is coming?

AM: Right, it’s coming, so that they get prepared.
IC: That’s the moral-hazard element of it.

AM: That’s the moral-hazard element.So all of those things could be improved. We could get a better exchange-rate system. We [could] insist upon a different ... set of financial arrangements so that countries’ banking systems don’t fail. And we want to make these things are automatic. If you meet the requirements for the loan, you get the loan, and there’s not going to be a long negotiation. So we would get rid of some of those crisis-prone conditions, and that would make the problem much less severe, and therefore, the world would be more stable.
We’d just like a different IMF. And unlike the people that are out on the streets, that we began this interview with, we think we have an idea of what needs to be done. I think many of those people don’t like the present system, and they’re right not to like the present system, but they don’t have a very clear idea as to what should take its place.

IC: Some of the critics of your commission’s report say that its recommendations would put such stringent terms on the IMF stepping in to help countries in need that, in Asia, for example, where there clearly was a crisis, the IMF wouldn’t have been able to come in and help those countries at all. Is that true?

AM: No, it’s false. Our report is very explicit, that if the crisis were to occur, as it did in 1998, and none of our conditions have been met because it was too early, they haven’t been done, then we would have done just what the IMF did. The IMF should have tried to prevent the crisis from spreading. So we’re not open to that criticism.
But the second and more important criticism is, what would have happened if our conditions exist in the future? Are they draconian and difficult?
The first one is that countries have to have adequate capital in the banking system. Now, that’s a rule [that] the developed countries themselves have adopted. They have all agreed to that; we’re just going to spread something like that to the rest of the world. The second condition is that countries have to allow foreign banks to compete on equal terms, or relatively equal terms, in their territory in order to make competition, in order to bring better management practices, in order to provide some kind of stable lenders.
The third is that a country has to have an adequate fiscal policy. It can’t be spending massive amounts of money that it doesn’t cover with taxes. And the fourth is [that] it has to let everyone know how much sovereign debt it has outstanding and how much of it comes due within one year, two years, three years, five years and so on.
Now, those are not extreme conditions. That question comes up a lot, and I usually say to people when they say to me, "These are extreme conditions," I’d say, "You know, here are the conditions; tell me what’s extreme about them." And I hope your audience will do the same. I mean, what’s extreme about these conditions?

IC: One other proposal that came out of the Meltzer Commission was in favor of debt relief for the so-called heavily indebted poor countries (HIPCs). What is the case for debt relief of the HIPCs?

AM: It’s a simple case. The way in which we deal with this problem now is [that] the country owes some money to the IMF or the World Bank ... and in order to make the loan marked current, we lend them more money to pay the interest. They don’t get that money; we just pay the interest to ourselves. And then next year, we come back and we lend them more money to pay the interest, and the loan is bigger, so we have to lend them more still to keep paying the interest.
Well that’s unsustainable. They don’t have the money to pay, and under current or foreseeable conditions, they aren’t going to have the money to pay. So these debts are going to be written off at one point or another. We might as well do it now -- if we can get, and this is an important proviso, the kinds of structural changes or institutional changes in these countries that will make it less likely that they’ll be in this problem again.
We want these countries to open their economy, to establish the rule of law, to allow private property and so on -- the things [that] have been shown to work in development everywhere. So if they begin to do those things, in exchange for that, we’re willing to write off the debt and say, "You’re not going to be able to pay it anyway, so you might just as well forget about it and wipe the slate clean."

IC: This seems like another case where you’re butting heads against the protesters, who might say that here’s an example of the IMF -- or whoever’s lending the money -- imposing American capital, pro-market, First World ways of running an economy into a sovereign nation who should be able to decide their own way of running the economy.

AM: They can decide. I mean, they can either decide that they’re going to continue with the present system and have the debt, or they can decide to adopt some things that are going to help them to get out of these problems.
And it’s true that these are things [that] have worked in the First World, but that’s to put the cart before the horse. The reason we’re the First World is because we have open capital markets; we have open trading markets; we have private property. Those are the things that have worked. And it isn’t just here. I mean, if we go to Asia and we look at countries -- Hong Kong, Taiwan, Korea, any country [that] has developed -- well you'll see the same thing.
China -- communist China -- is adopting many of these things. Open capital markets, open trading markets, why are they doing it? Is it because they want to adopt American capitalism? Probably not. It’s because it’s the one thing that works.

IC: Should Congress continue to fund the IMF?

AM: Congress should fund a renewed, revitalized, properly functioning IMF, yes. We need an IMF. But we don’t need a continuation of an institution [that] is as secret as the IMF.
I have great sympathy for the protesters. I mean, the IMF keeps its balance sheet in a way that even the people inside can’t read it and understand it. You can’t look at it and see what do they owe, who is putting up the money? I mean, you just can’t do that. People at the Joint Economic Committee, the Congress, worked for three years to try to straighten out the accounting so that they could understand what was going on. That’s a ridiculous setup, so we need some reforms in the IMF.
But once those reforms are in place, and I believe many of them will be in place, then I think we do need an IMF to act as a safety valve, to make sure that we don’t have really big structural collapses and to provide information to help the private markets, the capital markets, function more effectively.

IC: What is your opinion on the trend toward globalism?

AM: I don’t like the word globalism. I like open markets as a better term. I'm absolutely in favor. There is evidence that countries that open their markets, import better technology, learn by buying the machinery, learn how to send their students abroad to learn how to use the machinery, improve themselves.
There’s no doubt that those countries benefit. There’s no doubt that countries benefit from the rule of law, such as having people being required to deliver what they say they deliver, under penalty of having to pay a fine. Those things work: Democracy, openness -- those things are the things that make people richer, and it’s in everybody’s interest to see that happen.

IC: Is that in the United States’ interest as well?

AM: Absolutely it’s in the United States' interest. We’re not going to gain a lot if Burkina Faso or Sierra Leone opens its economy to trade. It won’t affect our GDP at all. But more than any other country in the world, we’ve taken the unique role of trying to spread market processes [and] democratic government around the world. That is America’s great accomplishment over the last 50 years.
We’ve had 50 years of reasonable peace, and reasonable economic stability. We can have another 50 years, if we spread this message to other countries.
If they’re not killing each other, we don’t have to send troops there, so we gain in that way, too. But we also gain, and we gain most importantly, because we believe that everyone in the world is better off if they live in a country [that] is prosperous and peaceful. And in order to do that, it seems to be true that they have to be opened and free and democratic and at least working within the confines of the market system.
The Soviet Union didn’t collapse because of some plot against Third World countries. And countries in Asia didn’t collapse because of some plot by the Westerners or the IMF. They collapsed because they didn’t do things that they needed to do to open their economies and make them more competitive.

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IC:	As the IMF-World Bank meetings get their start, the big story in the media will, of course, be the thousands of protesters expected here. What do you think about the protests? Are they a good thing?
AM:	They’re mixed. I think the idea that people are protesting against institutions [that] are relatively closed and not very transparent, where their money is being used, they don’t know what it’s being used for, is a good thing. They have read a lot about the corruption and the scandals. I think that’s probably good that there’s a protest for that. A lot of the protesters themselves, however, are a mixed bag. I mean, some of them are, are outright protectionists, like the labor unions. There are a lot of them around. Some of them are religious groups that are interested in debt relief for the poorest nations. And there are students. It’s spring and it’s a nice day, so there are a lot of people out, skipping, cutting classes, and so it’s a mixed group.
IC:	What do you think of the extreme element of the protest -- the people who come and wear costumes, and promote civil disobedience, and talk very negatively about how globalization is killing the world, and that the IMF is the Great Satan -- people who say things like that? What do they do to the level of exchange about the IMF? Do they do a disservice to the movement?
AM:	They lower the level of rational discussion because they make a lot of charges that I don’t think they quite understand themselves. There are mixtures of people there. Some of them are people who are protesting against what they call the “Washington consensus,” a policy of openness and trade, and things of that kind. But what they really want to do is not get rid of the Washington consensus. They just want to get a different consensus that they want to impose. We had some of these people appear before the commission that I chaired, talking about environmental issues. They were mainly good people, with a sincere belief. But they don’t understand that what they’re trying to do is just impose a different view on those people [that they claim to be speaking for] instead of taking the view that, which they sometimes claim to take, we should allow people to decide for themselves in the various countries. The aim of the IMF should be to make sure that the world is less subject to crises, and if it did that, it would be a good institution that was doing good things. The aim of the World Bank should be to lift people out of poverty, to help them while they’re in poverty, to get them out of poverty. If the organizations did that, then there would be very little to complain about.
IC:	Is it fair to say that you think both organizations are trying to overreach their mandates?
AM:	There’s no doubt about that. They've overlapped on each other's territory so that there’s no accountability and responsibility. But in addition to the lack of accountability and responsibility, they’ve just gone into doing a lot of things they really don’t know how to do very well. For example, take structural reform in Russia. Neither organization had experience with that. They had no real methods of reforming the structure. They now come out and say, "Well, once we give the money to the central bank, we do not know what happens to it." That’s true, but it’s disgraceful. There ought to be some system where they do know what happens to the money after it goes to the central bank, hard as that may be.
IC:	So what would a better involvement for the IMF in Russia have been?
AM:	The IMF should be a liquidity lender so [that] if the Russians had a financial crisis, or some country had a financial crisis and they needed some temporary assistance because markets wouldn’t help them out, then the IMF should be there. The IMF should also be there doing things like making sure that we have accurate information, kind of like the Securities and Exchange Commission does for, for commons stocks and bonds in the United States. We need somebody to do that for countries. If we’re going to rely on private capital markets, on the capital markets to do the lending in the world, then we need to give them the information so they can make good decisions. But that should be their job. The World Bank’s job should be to help countries like Russia develop. But in our view, the view of the commission that I just chaired, the way in which they go about this is really very wrong. It’s ineffective by their own measures. Seventy percent of the programs in Africa fail, 50% of the programs overall fail. And that’s measuring failure and success in a very peculiar way. The bank measures it when they give out the money rather than when they look two or three years down the road and find out, did this actually do what it was supposed to do?
IC:	So they fail in part because there aren’t enough strings attached to the money that they give -- or accountability toward the money they give?
AM:	Well, we don’t want more strings; there are plenty of strings. The IMF and bank come up with 40, 50, 60 different rules that countries have to follow. Mostly they don’t get followed. What we would like the countries to do is to say we want to improve inoculations against measles ... we want to inoculate our children against measles. Then the bank would say, "We’ll lend you the money, we’ll give you the money, we’ll give you a grant, and if you’re a very poor country, we’ll give you 90% of the money. You have to come up with 10%. But we’re not going to pay it to you. We’re going to pay it to somebody who does the inoculations, when the inoculations are complete." "How will we know that?" [they might ask. And we'll say,] "We’re, you’re going to have to hire an auditor who’s going to come in and he’s going to check their arms and see that we actually did inoculate these people, or we actually did put in the sanitary sewers, or we actually did make sure that there was electricity in the houses. Those are projects that we’d see, and we’re going to see that they’re done." So, we’re going to have effective programs. That’s what we want. And we’re going to cut out the role of the government, where the money goes into the government and who knows what happens to it after that.
IC:	Let’s talk specifically about some recent IMF bailouts -- in Korea, Indonesia, Thailand, Russia, Mexico, Brazil. Did those bailouts do more harm than good?
AM:	No, that’s hard to say. I don’t think that they did more harm than good. I think that they may not have done a lot of good, but they certainly didn’t do more harm than good. If we look now, two years, three years after the so-called crisis began, most of the countries are recovering. They’ve, many of them, have passed the level of income that they had before the crisis. Now, how much do we want to attribute that to what the IMF did, and how much do we want to attribute that to the fact that the United States absorbed large amounts of exports from these countries, and so that helped them? Well, that’s harder to know. Eventually, the researchers will straighten that out and give us an answer to that question, but I don’t think we know at this moment. What we can say is, that if the IMF were doing its job the way we would like them to do it, those crises would have been much less likely to occur. That is because crises occur for three reasons: One, because countries have an exchange rate that’s wrong, and they try to defend it, so they throw lots and lots of the taxpayers’ money in and usually fail. Second, they have weak banking systems -- because the government doesn’t allow competition in banking from outside, because the banks are under-capitalized, because the government’s used them as a slush fund to reward their friends. And the third thing is because when the crisis comes, the IMF wants to put on all sorts of conditions on these loans, and it takes a long time to negotiate the conditions. And meanwhile, the crisis gets much worse.
IC:	And people know the IMF is coming?
AM:	Right, it’s coming, so that they get prepared.
IC:	That’s the moral-hazard element of it.
AM:	That’s the moral-hazard element.So all of those things could be improved. We could get a better exchange-rate system. We [could] insist upon a different ... set of financial arrangements so that countries’ banking systems don’t fail. And we want to make these things are automatic. If you meet the requirements for the loan, you get the loan, and there’s not going to be a long negotiation. So we would get rid of some of those crisis-prone conditions, and that would make the problem much less severe, and therefore, the world would be more stable. We’d just like a different IMF. And unlike the people that are out on the streets, that we began this interview with, we think we have an idea of what needs to be done. I think many of those people don’t like the present system, and they’re right not to like the present system, but they don’t have a very clear idea as to what should take its place.
IC:	Some of the critics of your commission’s report say that its recommendations would put such stringent terms on the IMF stepping in to help countries in need that, in Asia, for example, where there clearly was a crisis, the IMF wouldn’t have been able to come in and help those countries at all. Is that true?
AM:	No, it’s false. Our report is very explicit, that if the crisis were to occur, as it did in 1998, and none of our conditions have been met because it was too early, they haven’t been done, then we would have done just what the IMF did. The IMF should have tried to prevent the crisis from spreading. So we’re not open to that criticism. But the second and more important criticism is, what would have happened if our conditions exist in the future? Are they draconian and difficult? The first one is that countries have to have adequate capital in the banking system. Now, that’s a rule [that] the developed countries themselves have adopted. They have all agreed to that; we’re just going to spread something like that to the rest of the world. The second condition is that countries have to allow foreign banks to compete on equal terms, or relatively equal terms, in their territory in order to make competition, in order to bring better management practices, in order to provide some kind of stable lenders. The third is that a country has to have an adequate fiscal policy. It can’t be spending massive amounts of money that it doesn’t cover with taxes. And the fourth is [that] it has to let everyone know how much sovereign debt it has outstanding and how much of it comes due within one year, two years, three years, five years and so on. Now, those are not extreme conditions. That question comes up a lot, and I usually say to people when they say to me, "These are extreme conditions," I’d say, "You know, here are the conditions; tell me what’s extreme about them." And I hope your audience will do the same. I mean, what’s extreme about these conditions?
IC:	One other proposal that came out of the Meltzer Commission was in favor of debt relief for the so-called heavily indebted poor countries (HIPCs). What is the case for debt relief of the HIPCs?
AM:	It’s a simple case. The way in which we deal with this problem now is [that] the country owes some money to the IMF or the World Bank ... and in order to make the loan marked current, we lend them more money to pay the interest. They don’t get that money; we just pay the interest to ourselves. And then next year, we come back and we lend them more money to pay the interest, and the loan is bigger, so we have to lend them more still to keep paying the interest. Well that’s unsustainable. They don’t have the money to pay, and under current or foreseeable conditions, they aren’t going to have the money to pay. So these debts are going to be written off at one point or another. We might as well do it now -- if we can get, and this is an important proviso, the kinds of structural changes or institutional changes in these countries that will make it less likely that they’ll be in this problem again. We want these countries to open their economy, to establish the rule of law, to allow private property and so on -- the things [that] have been shown to work in development everywhere. So if they begin to do those things, in exchange for that, we’re willing to write off the debt and say, "You’re not going to be able to pay it anyway, so you might just as well forget about it and wipe the slate clean."
IC:	This seems like another case where you’re butting heads against the protesters, who might say that here’s an example of the IMF -- or whoever’s lending the money -- imposing American capital, pro-market, First World ways of running an economy into a sovereign nation who should be able to decide their own way of running the economy.
AM:	They can decide. I mean, they can either decide that they’re going to continue with the present system and have the debt, or they can decide to adopt some things that are going to help them to get out of these problems. And it’s true that these are things [that] have worked in the First World, but that’s to put the cart before the horse. The reason we’re the First World is because we have open capital markets; we have open trading markets; we have private property. Those are the things that have worked. And it isn’t just here. I mean, if we go to Asia and we look at countries -- Hong Kong, Taiwan, Korea, any country [that] has developed -- well you'll see the same thing. China -- communist China -- is adopting many of these things. Open capital markets, open trading markets, why are they doing it? Is it because they want to adopt American capitalism? Probably not. It’s because it’s the one thing that works.
IC:	Should Congress continue to fund the IMF?
AM:	Congress should fund a renewed, revitalized, properly functioning IMF, yes. We need an IMF. But we don’t need a continuation of an institution [that] is as secret as the IMF. I have great sympathy for the protesters. I mean, the IMF keeps its balance sheet in a way that even the people inside can’t read it and understand it. You can’t look at it and see what do they owe, who is putting up the money? I mean, you just can’t do that. People at the Joint Economic Committee, the Congress, worked for three years to try to straighten out the accounting so that they could understand what was going on. That’s a ridiculous setup, so we need some reforms in the IMF. But once those reforms are in place, and I believe many of them will be in place, then I think we do need an IMF to act as a safety valve, to make sure that we don’t have really big structural collapses and to provide information to help the private markets, the capital markets, function more effectively.
IC:	What is your opinion on the trend toward globalism?
AM:	I don’t like the word globalism. I like open markets as a better term. I'm absolutely in favor. There is evidence that countries that open their markets, import better technology, learn by buying the machinery, learn how to send their students abroad to learn how to use the machinery, improve themselves. There’s no doubt that those countries benefit. There’s no doubt that countries benefit from the rule of law, such as having people being required to deliver what they say they deliver, under penalty of having to pay a fine. Those things work: Democracy, openness -- those things are the things that make people richer, and it’s in everybody’s interest to see that happen.
IC:	Is that in the United States’ interest as well?
AM:	Absolutely it’s in the United States' interest. We’re not going to gain a lot if Burkina Faso or Sierra Leone opens its economy to trade. It won’t affect our GDP at all. But more than any other country in the world, we’ve taken the unique role of trying to spread market processes [and] democratic government around the world. That is America’s great accomplishment over the last 50 years. We’ve had 50 years of reasonable peace, and reasonable economic stability. We can have another 50 years, if we spread this message to other countries. If they’re not killing each other, we don’t have to send troops there, so we gain in that way, too. But we also gain, and we gain most importantly, because we believe that everyone in the world is better off if they live in a country [that] is prosperous and peaceful. And in order to do that, it seems to be true that they have to be opened and free and democratic and at least working within the confines of the market system. The Soviet Union didn’t collapse because of some plot against Third World countries. And countries in Asia didn’t collapse because of some plot by the Westerners or the IMF. They collapsed because they didn’t do things that they needed to do to open their economies and make them more competitive.