Why Prague Protests Prompt Warm Memories for Some IMF Dignitaries

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Karl Marx famously noted that the great events of history tend to occur twice — first as tragedy and then as farce. Back in the spring of 1968, Prague's storied streets and squares were filled with idealistic young people armed only with a passionate commitment to freedom as they waged a doomed battle against Soviet tanks. Twenty-two years later, those streets are once again filled with idealistic young people, but this time the target of their ire is not communism, but global capitalism. The spectacle of demonstrators on the streets brandishing the same hammer-and-sickle logo that had adorned those Russian tanks must look a little bizarre to a Czech population who suffered four decades of the repression, deprivation and tragicomic absurdity of communism; indeed, the standoff between leftist demonstrators and the World Bank and IMF whose summit they're trying to disrupt may be a little farcical, but it's not without its ironies.

To be sure, Tuesday's demonstrations and the tear gas, water cannon and arrests they occasioned may have provoked nostalgia rather than anxiety in the chairman of the Prague meetings of the IMF and World Bank. Trevor Manuel may be South Africa's internationally respected finance minister, but a little over a decade ago he was still on the wrong end of the tear gas and water cannon as a firebrand anti-apartheid leader. The conference's host, Czech president Vaclav Havel may be feeling a little nostalgic, too — after all, back in '68 he was just another Absurdist playwright trying to overthrow the system.

But this is no trite tale of generational change in which yesterday's malcontents become today's mandarins. Many of those at the pinnacle of the World Bank share the demonstrators' concerns that globalization has brought few dividends to the world's poor, and that the burden of debt owed by developing countries to the G7 industrialized nations threatens to keep them permanently impoverished. But while the protesters are calling for the IMF and World Bank to be disbanded, representatives of the developing world who are forced to deal every day with the reality of a global financial system in which the cards are stacked against them but on which their liquidity depends are fighting a battle within those institutions. "[World Bank president James] Wolfensohn and [current IMF head Horst] Kohler have become extremely important allies for us," Manuel told the New York Times. "Our real problem is the U.S., Britain and France," he said, referring to those countries' reluctance to deliver on promises of debt relief and to share power in the international financial institutions. "The protesters seem not to understand these things."

Indeed, Wolfensohn had become an outspoken critic of IMF policy after he judged that the international lender had actually exacerbated the economic crisis in countries such as Indonesia two years ago by insisting on harsh austerity measures as a condition for a financial bailout — which made the poorest and most vulnerable members of society pay the price for the errors of that nation's notoriously corrupt elite. Wolfensohn on Tuesday even saluted the demonstrators. "I believe deeply that many of them are asking legitimate questions, and I embrace the commitment of a new generation to fight poverty," said Wolfensohn. "I share their passion and their questions, but I believe we can move forward only if we deal with each other constructively and with mutual respect." In other words, this time there'll be no tanks, and the "establishment" will feel at liberty to borrow the demonstrators' slogans.