Congressional Politics of International Financial Rescues

In the 1990s, the American executive organized financial rescues for Mexico and several Asian economies. These rescues were controversial in Congress, where members voted repeatedly to reduce or eliminate the executive's freedom to engage in them. I analyze these roll calls with an eye toward e...

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Bibliographic Details
Published in:American journal of political science 2005-07, Vol.49 (3), p.479-496
Main Author: Broz, J. Lawrence
Format: Article
Language:English
Subjects:
Banks
Campaign contributions
Congressional voting
Criticism
Debt cancellation
Economic crises
Economic crisis
Economic globalization
Emerging markets
Empirical research
Executive power
Financial crisis
Financial policy
Fiscal Policy
Foreign Aid
Foreign economic policy
Imports
Interest Groups
International banks
International finance
International loans
International trade
Legislators
Policy Making
Political action committees
Public Sector Private Sector Relations
Roll Call
U.S.A
United States of America
Unskilled workers
Voting
Voting Behavior
Workers' participation
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Summary:In the 1990s, the American executive organized financial rescues for Mexico and several Asian economies. These rescues were controversial in Congress, where members voted repeatedly to reduce or eliminate the executive's freedom to engage in them. I analyze these roll calls with an eye toward explaining who opposes and who supports international financial rescues. I argue that the interests of private actors (district constituencies and interest groups) have an important effect on member voting. Following Stolper-Samuelson reasoning, I find that a member is significantly more likely to favor (oppose) rescues as the proportion of high-skilled (low-skilled) workers in a district increases. In addition, I find that campaign contributions from international banks increase the probability that a member will vote in favor of rescues. Overall, the findings suggest that the distributional effects of rescues find expression in Congress and constrain U.S. international financial policymaking.
ISSN:0092-5853
1540-5907
DOI:10.1111/j.1540-5907.2005.00137.x