Anne krueger and John Taylor share remarkable similarities. Until recently both were colleagues at Stanford's Hoover Institution. Both are eminent conservative economists, generally sceptical of government meddling. Both were picked for public service by the Bush administration: Ms Krueger as number two at the International Monetary Fund and Mr Taylor as the top international man at the Treasury department. This week the two had a public split over how best to deal with insolvent countries. When companies default on their debts there is a clear procedure to guide a restructuring. Not so with countries. In the debt crisis of the 1980s, the resulting vacuum meant protracted negotiations with banks. Since the 1990s, when emerging-market bonds became popular, the situation has only worsened. Organising the disparate owners of diverse bonds in different jurisdictions has proved a nightmare. Though sovereign restructurings are possible―Russia, Ukraine and Ecuador have all recently restructured their debts-the process clearly needs improvement. For conservatives the idea holds particular attraction, since, in their view, it might lessen the need for IMF rescues.
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