Brazil's debt rip-off.

ITEM: According to Reuters for October 9. el team from the International Monetary, Fund (IMF) was heading to Brazil "to assess the state of the economy under a $30 billion loan program and decide whether the country should "exit the program which expires at the end of the year...." Continued the wire service: "The IMF has said the decision is up to Brazil's new government which has beet* lauded by the fund for its handling of the economy, although the country's public and external debt remains very high."

BETWEEN THE LINES: It's hardly a surprise that Brazil has its hands out again. As pointed out by Ian Vasquez, author of Global Fortune, Brazil received an IMF-backed bailout of $41.5 billion in 1998; the currency collapsed three months later. In 2001, Brazil quickly chewed up $15 billion in additional IMF funding. Another $30 billion loan was dispensed the next year.

The traditional IMF formula for dispensing aid? First, the recipient must raise taxes and devalue its currency. Naturally, this minimizes incentives to work, save or invest. As Johns Hopkins Professor Steve Hanke has noted, the IMF gave Brazil $30 billion after it increased its domestic money supply in 2002 by 60 percent--in essence, "rewarding Brazil for this bad monetary behavior."

The economy in Brazil remains largely unfree. It has been unable to sustain growth, notes a Heritage Foundation analysis, "and 49 percent of the population therefore remains poor, with Brazil's huge debt burden crippling growth prospects." The IMF and its supporters, though, paint a rosy picture so the boondoggle can continue.