n What the fund's next leader needs to do Watching the clumsy and clubby way the International Monetary Fund has been choosing a new managing director, you would not guess that its credibility as an impartial arbiter of global economic policies is at stake. It is. The IMF has less than two weeks to rescue itself from a habit of treating leadership selection as an exercise of political power rather than as a contest of merit. Its decision will be announced by June 30, writes The New York Times in its editorial. Excerpts: The next managing director will have to deal with a faltering and unbalanced global economic recovery, Europe's worsening sovereign debt and banking crisis, and, almost certainly, currency and balance-of-payments crises. So far, the fund's governing board has done little to encourage a broad range of candidates qualified for these challenges. It seems determined to skew the selection toward the trans-Atlantic establishment's favorite, Christine Lagarde, France's finance minister. Emerging economies like China, India and Brazil resent the fund for considering only candidates from Western Europe. Asian, African and Latin American countries feel, with reason, that the fund has taken a harsher line toward their debt problems than those of richer economies. With only two candidates now in the race — Ms. Lagarde and her long-shot rival, Agust?n Carstens, governor of Mexico's central bank — it is crucial that they offer clear answers to questions about the economic policies they have favored in the past and how open they would be to other approaches. Ms. Lagarde, for one, has strongly backed the harsh austerity strategy that has failed to rescue Greece because it left no room for debt restructuring and economic growth. French banks and the European Central Bank, now among Greece's biggest creditors, are still doing all they can to block restructuring. Does Ms. Lagarde still agree with that approach? Would she be more open to restructuring in Greece and other troubled countries as part of a comprehensive strategy for reform and growth? As Mexico's central banker since 2010, Mr. Carstens has delivered enviable price stability. But before that, as finance minister, he badly underestimated the depths of the global crisis, and provided Mexico with far too little fiscal stimulus, letting the country slide into a much deeper recession. Would he insist that other countries sacrifice jobs and growth to a monetarist and fiscal orthodoxy? Both candidates have impressive skills and practical experience. But we need to know more to decide who would make the best IMF leader at this critical juncture. __
