Presto: Another $750 Billion

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The U.S. and Europe were widely expected to clash at the G-20 summit in London last month over how to address the global financial crisis. Voila, in just two days the problem was solved with a joint promise to increase International Monetary Fund resources by $750 billion to a total of $1 trillion.

The U.S. portion of this new commitment is more than $140 billion. Yet Congress has debated neither the amount nor the proposed use of the funds. Instead, President Obama and his fellow leaders simply waved their hands, like a Star Trek captain, and said make it so.

Recall that the IMF was founded in 1944 when the world monetary system operated on a gold standard. The fund's job was to act as a lender of last resort when countries encountered balance-of-payments shortfalls. When the world went to a fiat-currency system, the fund's original role became obsolete. Over the past 30 years the fund has increasingly strayed from that limited mission to become a vehicle for transferring wealth to poor-country governments.

The London agreement further advances these foreign aid ambitions with no oversight from Congress...

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