A decade ago, the International Monetary Fund helped to stabilize the world economy after markets collapsed in Latin America, Russia and Asia. Though critics often have rued its interventionism, the fund was widely hailed as a heroic guardian of the global financial system.
Today, the only crisis faced by the I.M.F. is a crisis of identity. Countries rescued in the 1990s have mostly repaid their debts. With a shrunken loan portfolio, the institution that lectures others about finances has lost operating income and is running a deficit. It faces cuts in its staff and salaries and is even considering the sale of its gold bullion reserves.
“What might be at stake today is the very existence of the I.M.F. as the major institution providing financial stability to the world, a global public good,” Dominique Strauss-Kahn, a former French finance minister, told the fund’s directors last week. “In sum, the two main issues are relevance and legitimacy.”
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