IRVINE, CA--"The International Monetary Fund [IMF] should not lend a single penny to Brazil, much less $30 billion," said Dr. Onkar Ghate, a senior fellow at the Ayn Rand Institute.
      Why should we care about the issue?
      "Because," Dr. Ghate answers, "the United States is the IMF's largest donor, which means that U.S. taxpayers will foot the bill for much of the promised $30 billion bailout. At a time when Americans are losing their jobs and the country is at war, it is unconscionable for our government to pour money down another third-world drain.
      "The reason Brazil desperately needs the money--its massive government intervention in the economy and the promise of more to come following October presidential elections--is precisely the reason it should not get it. To bail out Brazil is worse than useless. A bailout teaches Brazil--and other Latin American countries--that the irrational economic and political policies it has been pursuing bring no destructive consequences--and so only encourages its government to continue trying to cheat reality. This is why, despite numerous IMF loans and handouts, most countries in Latin America are, periodically, in financial crisis, as Brazil itself was back in 1999."
      "Though it is not a proper function of our government," Dr. Ghate said, "if we really wanted to help Brazil we would send it not money but a copy of our constitution. That is, we would teach Brazilians how to create a capitalist system, one that separates not only state from church but also state from economics. Then Brazil would become prosperous and the need for handouts would end."

ARI senior fellow Onkar Ghate is available for interviews on this topic.