IMF chief pulled off plane in NY on rape charges

The story is as salacious as it is puzzling.  New York police marched Dominique Strauss-Kahn off of an airplane yesterday to face charges of rape after an alleged sexual attack on a maid earlier in the day.  By nighttime, the arrest of the head of the International Monetary Fund had people wondering whether Greece would melt down, and whether the IMF could remain in Western hands — as well as what kind of Socialists stay in $3000-per-night hotel suites:

The French political bigshot who heads the International Monetary Fund was arrested for allegedly sodomizing a Manhattan hotel maid today — hauled off an Air France flight just moments before takeoff from Kennedy Airport, police said.

Three Port Authority detectives pulled Dominique Strauss-Kahn from the plane’s first-class cabin just two minutes before it was due to depart for Paris, according to police sources said.

Strauss-Kahn, 62 — who was expected to challenge Nicholas Sarkozy in the 2012 French presidential election — was turned over to NYPD officers and brought to the Special Victims Unit’s uptown squadroom.

The Post has the lurid details, but it’s hardly the first time Strauss-Kahn has embarrassed the IMF.  Three years ago, he admitted to sleeping with a subordinate, a peccadillo that should have pushed the IMF to can him then.  It won’t get any better for the IMF, either, as another woman in France may file a complaint about an alleged attack that occurred several years ago.

Strauss-Kahn’s lawyers have leaked that they’re looking for an alibi, insisting that the suspect wasn’t even in the hotel at the time.  That will be difficult to sell, since the victim picked Strauss-Kahn out of a lineup:

Dominique Strauss-Kahn, a married father of four whose reputation with women earned him the nickname “the great seducer,” faced arraignment Monday on charges of attempted rape and criminal sexual contact in the alleged attack on a maid who went into his penthouse suite at a hotel near Times Square to clean it.

Strauss-Kahn was taken into custody on Saturday and spent more than 24 hours inside a Harlem precinct, where police say the maid identified him from a lineup, then headed to a hospital for a “forensic examination” requested by prosecutors to obtain more evidence in the case, defense lawyer William Taylor said. He was taken to a Manhattan court early Monday.

If they argue for a case of mistaken identity and then DNA connects Strauss-Kahn to the victim, that’s going to put the defense in a rather tight box.

His fellow Socialists in France are defending him, at least for now:

Fellow Socialists increasingly defended Strauss-Kahn, citing contradictions in the investigation, and pledged to stick to the campaign calendar.

“His close friends cannot believe that he is guilty,” said Socialist politician and friend Jean Christophe Cambadelis.

Perhaps, but the Economist can’t believe he’s a Socialist, either — not with those hotel bills:

Just note that the New York Times states that he was staying in a $3,000 a night suite and was taking a first class flight to Paris. This is the IMF, the body that imposes austerity on indebted countries and is funded by global taxpayers. And this was the likely leading socialist candidate for the French presidency.

John Hinderaker at Power Line notes that Socialism ain’t what it used to be:

$3,000 a night–not for a family or an entourage, but for a single socialist! Not bad. … Obviously socialists have reconciled themselves to bourgeois comforts like first-class air travel. Any time you want, for free.

The Washington Post looks at the impact of the arrest on Europe and the global economy, and it doesn’t look promising.  The $155 billion loan to Greece hasn’t solved the nation’s debt crisis, and Strauss-Kahn was about to go back to Europe for more cash to rescue Athens.  Now, there may be no one to convince Europe to salvage its investment in Greece at all:

Strauss-Kahn’s absence may be felt most immediately in the IMF’s work with the European Union to prevent the debt crisis engulfing several countries from getting out of hand.

His arrest “comes at just the worst possible time for Europe,” said Eswar Prasad, an international economics professor at Cornell University. “As the world economy stumbles its way to recovery, this could be a pretty serious blow that sets things back.”

A $155 billion loan provided to Greece in spring 2010 is proving insufficient to keep the country out of insolvency. Strauss-Kahn had been considering modifying the terms of the loan to lighten the load on Greece while discussing the potential of a new $85 billion loan to Greece with the European Union.

He was slated to meet with Europe’s finance ministers in Brussels on Monday to weigh the further aid to Greece and work through details of an IMF-backed bailout of Portugal. The organization said IMF Deputy Managing Director Nemat Shafik, who oversees the group’s work in various European Union countries, will attend instead.

The nations of the EU may want to keep the IMF at arm’s length for a while, so don’t expect an enthusiastic rush to push more funds through it when Shafik makes his bid.  The next head of the IMF may pay less attention to European concerns, too:

The IMF on Sunday named Strauss-Kahn’s second-in-command, former banker John Lipsky, as his replacement. But Lipsky was planning to step down at the end of the summer, and while a European has long led the IMF, countries such as China and India are considering nominating one of their own for the top spot. That could also have wide ramifications for the organization, whose emerging market members have complained that it shows more generous treatment toward European countries than those in the developing world.

Traditionally, an American leads the World Bank and a European leads the IMF.  If Europe loses the IMF position, they may get even less enthusiastic about contributing to its projects than they will be now with Greece.

It’s impossible to predict what will happen next, but one question will have to get resolved soon.  Strauss-Kahn’s lawyers claim that he has diplomatic immunity as part of his IMF portfolio, while New York police beg to differ.  That question will have to ultimately be resolved by the White House, which will have the unpleasant task of deciding between potentially angering France (although probably not Nicolas Sarkozy) by prosecuting him just when France has taken the lead on Libya and to a lesser extent on Eurozone bailouts, or letting a potential rapist walk free.  If Strauss-Kahn’s defense pushes hard on the immunity claim (which is probably not valid), though, it’s going to make him look guilty as hell, and the political damage in Europe from denying the claim will probably be significantly reduced.