GOP senators to Obama: Don't give US money to IMF for Greece

Two GOP senators are pushing President Obama to not include American dollars in any International Monetary Fund bailout loan to Greece.

Sens. John Cornyn (Texas) and David Vitter (La.), in a letter sent to President Obama, say that using taxpayer money to help Greece through the IMF would violate a provision they included in last year’s Dodd-Frank Wall Street reform bill.

The pair of Republicans added that they think it is “highly unlikely” that Greece – whose debt was 142 percent of its gross domestic product in 2010 – would repay any IMF loans. 

“These provisions became federal law for a reason,” Cornyn and Vitter wrote. “We sought to prevent U.S. taxpayers’ money from again being used by the IMF to bail out foreign nations that have made irresponsible spending decisions.”

Under the two senators’ measure – which passed 94-0 – the American executive director of the IMF, at the direction of the Treasury secretary, is supposed to examine any loan earmarked for developed countries whose debt is larger than its GDP. 

The treasury secretary is also expected to tell the executive director to oppose any loan that is not expected to be fully repaid. 

In their letter, Cornyn and Vitter also said they wanted the president to “refrain from giving the impression to U.S. allies or global financial markets that the U.S. would act in violation [of] this provision of law or defy the will of Congress.”

The senators’ letter comes less than a week after the president, in a joint news conference with Chancellor Angela Merkel of Germany, said that the two countries would work on the Greece situation  “both on a bilateral basis but also through international financial institutions like the IMF.”

“Greece's debt is significant, and it is taking some difficult steps to improve its situation. But they're under the gun from the international capital markets,” Obama also said.