Christine Lagarde Will Run The IMF : Planet Money The IMF has always been run by a European. The U.S. threw it's weight behind Lagarde today, ensuring that the tradition will continue.
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Christine Lagarde Will Run The IMF

"I am pleased to announce our decision to support Christine Lagarde to head the International Monetary Fund," Tim Geithner said in a statement this morning.

Lagarde, the French finance minister, already had the backing of most of Europe, as well as China. Support from the U.S. effectively seals the deal: Lagarde will run the IMF.

Update: The IMF has chosen Lagarde as its next director, Reuters reports.

Since the IMF was founded in the 1940s, it's always been run by a European. (Under the same unwritten rule, the IMF's sister organization, the World Bank, has always been run by an American.)

There was a push from some quarters for that to change this time. After the Asian crisis of the 1990s, many people in the developing world argued that the fund put the interests of the U.S. and Europe ahead of the needs of developing countries.

Agustín Carstens, the head of Mexico's central bank, was also a candidate for the job. He got the support of Canada and Australia.

Over the past several decades, the IMF served mostly as a lender of last resort to developing world countries during financial crises. That changed in the past year, when the IMF played a central role in the bailouts of Greece, Ireland and Portugal.

For more on the history and purpose of the IMF, listen to our podcast, "Do We Need The IMF?"