U.S. Pressures Strauss-Kahn to Resign from The CFR

U.S. Pressures Strauss-Kahn to Resign

Speaking in Manhattan, U.S. Treasury Secretary Timothy Geithner urged the IMF to replace its chief (BBC), Dominique Strauss-Kahn, suggesting he can no longer perform his duties. The comments from the Obama administration come as Strauss-Kahn continues to be held in New York City without bail on charges of sexual assault. Geithner called for greater formal recognition by the IMF board that John Lipsky (WSJ), the fund's second-in-command, will continue serving as temporary managing director for an interim period. Although Strauss-Kahn has yet to resign, sources say the IMF is in touch with his legal counsel to discuss his future at the organization.

With the fund's leadership position in serious limbo, initial discussions have already begun on naming a potential successor (FT). European leaders increased their calls for a continuation of the tradition that the IMF leader be from the continent. France's finance minister, Christine Lagarde, has emerged as an early favorite. Experts say the chances of developing countries to push for a non-European candidate will depend on their ability to support a single figure. China has said the position should be filled on the basis of "fairness, transparency, and merit," while officials in Brazil and South Africa assert the job should go to someone representing an emerging market (DeutscheWelle). Currently, the United States has the most votes within the IMF and will likely play a prominent role in selecting a replacement.

Analysis:

The arrest of IMF chief Dominique Strauss-Kahn could hamper the fund's short-term ability to help manage the eurozone crisis but is not likely to harm the IMF over the long term, says CFR's Steven Dunaway.

This op-ed for the Financial Times discusses the implications of Dominique Strauss-Kahn's arrest on the European financial crisis and the underlying economics of a recovery.

The Brookings Institution's Johannes Linn writes that given the need for a strong, legitimate IMF to assist in managing relations among major global economic players, the leadership succession process must be fair, open-minded, and unconstrained by nationality.

Multimedia

The Wall Street Journal Europe editorial page editor Brian Carney explains the policy impact of Dominique Strauss-Kahn's arrest.