Institute of International Finance, Washington, D.C. — April 23 2025
U.S. Treasury Secretary Bessent stormed the International Finance stage on Tuesday and lobbed a volley of accusations that rattled the very foundations of the Bretton Woods twins. Condemning the International Monetary Fund and World Bank as “lumbering giants whistling past the graveyard,” Bessent warned that the United States will cut the cord unless the institutions abandon what he called a decade-long slide into “vapid, buzzword-centric marketing” and return to their core missions.
1. Mission Creep
Treasury Secretary Bessent, opening broadside, charged that “mission creep has knocked these institutions off course,” replacing balance-of-payments surgery and poverty reduction with an ever-expanding grab bag of fashionable causes.
2. Bloated, Unfocused Agendas
He argued that today’s sprawling portfolios “stifle [the IMF and World Bank’s] ability to deliver on core mandates,” likening them to a hospital that shuttered its emergency room to host a TED Talk.
3. ‘Buzzword-Centric Marketing’ and Blank Checks
Turning to the World Bank, Bessent seethed that executives “expect blank checks for vapid, buzzword-centric marketing accompanied by half-hearted commitments to reform.” Until those slogans translate into measurable outcomes, U.S. dollars—he suggested—will be locked behind concrete metrics.
4. Climate-and-Gender Crowd-Out
The IMF, he said, now devotes “disproportionate time and resources to climate, gender, and social issues,” crowding out the bread-and-butter macro-stability work that keeps markets afloat.
5. ‘Pollyanna Economics’ and the Graveyard Whistle
Bessent mocked the IMF’s 2024 External Sector Report—titled Imbalances Receding—as evidence the Fund is “whistling past the graveyard” while deficits balloon.
6. Muzzling Tough Talk on China
He blasted the IMF for failing to “call out countries like China” over “distortive policies and opaque currency practices,” warning that systemic risk is metastasizing in the silence.
7. Enabling Unsustainable Debt
The Fund, Bessent insisted, indulges “unsustainable lending practices,” keeping serial defaulters on life support instead of forcing real reform.
8. Lending to ‘Graduated’ Giants
Switching targets, he called it “absurd” that the World Bank continues to lend to China and other countries that long ago met graduation criteria—capital that should flow to the world’s poorest.
9. Distortionary Climate Targets vs. Energy Poverty
By chasing headline climate metrics, the Bank sidelines gas and nuclear projects that could electrify entire continents, Bessent warned. “Energy abundance sparks economic abundance,” he reminded the room.
10. Corrupt Procurement Pipeline
Finally, he accused the Bank’s lowest-bid procurement rules of “incentivizing corruption and collusion,” even allowing firms that “financed or supplied the Russian war machine” to slip through—an intolerable security breach.
What Happens Next?
Bessent’s tirade was more than rhetorical fireworks. As the largest shareholder, Washington can:
- Freeze or redirect U.S. contributions until hard performance metrics appear.
- Press G-7 allies to enforce strict graduation rules—especially for China—reshaping tens of billions in future lending.
- Demand forensic audits of procurement chains tied to sanctioned entities, blacklisting contractors across every multilateral lender.
- Rewrite IMF surveillance mandates to prioritize currency transparency and debt-sustainability triggers.
For borrowing nations that lean on IMF emergency lines or World Bank project pipelines, the message is stark: reform or risk losing the lifeline. The coming weeks will reveal whether the Bretton Woods twins pivot—or double down and dare Congress to swing the axe.
“America First does not mean America alone,”. “But it does mean we will no longer bankroll institutions that have forgotten why they exist.” Treasury Secretary Bessent
Either way, the era of blank checks is over—and the global financial order just felt the tremor.