WASHINGTON May 17 The United States would
oppose International Monetary Fund bailout packages to
countries that are not likely to repay them under a measure
passed by the U.S. Senate on Monday.
The 94-0 vote came amid widespread concern that the United
States is indirectly supporting a $40 billion IMF bailout
approved for Greece earlier this month as that country
struggles to rein in its debt.
A series of unprecedented U.S. bailouts to stem the 2008-09
economic crisis has angered many Americans and lawmakers have
said they are unwilling to bailout foreign countries, as well.
European leaders have asked the IMF to stand ready to
provide up to $310 billion as part of a $1 trillion package of
loans and guarantees to prevent Greece's financial woes from
spreading to other euro zone countries with big budget
deficits, such as Portugal and Spain.
The United States is the IMF's largest contributor and has
veto power to block decisions, although has never used it. The
United States' stake in the IMF is roughly worth $54 billion in
The measure, proposed by Republican Senator John Cornyn,
would direct the United States' executive director at the IMF
to determine whether there is likely to be repayment of loans
to countries whose public debt exceed their gross domestic
If the director determines that the loan is not likely to
be repaid, the executive director would be obligated to vote
The measure was added to a sweeping rewrite of financial
regulations that could clear the Senate this week. It would
have to be reconciled with a similar bill that passed the House
of Representatives in December before President Barack Obama
could sign it into law.
Senator Christopher Dodd, the Democrat overseeing the
financial-reform bill, said he supported the IMF clause but
added that it might be modified in coming weeks to satisfy
(Reporting by Andy Sullivan and Lesley Wroughton; Editing
by Bill Trott)