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Suddenly the IMF is very much in the news. The G-20 Summit agreed last week to large increases in resources to enable the Fund to respond to the global crisis. And the week before the IMF Board approved radical changes in access, pricing and conditionality for IMF borrowers, making IMF loans and insurance (precautionary loans immensely more attractive for countries like Brazil and Mexico. Already Mexico has come forward to request access to the new Flexible Credit Line. The new lending rules show that the IMF bureaucracy is finally beginning to respond effectively to reality of responsible macro management in many emerging market economies.

Amid these signs of renewed IMF vitality, the March 24 Final Report of the Committee on IMF Governance Reform, despite the worthy effort to issue it prior to the G-20, already seems outdated and got little notice. Here’s part of what Dominique Strauss-Kahn, the IMF Managing Director, is quoted as saying about the report in an IMF press release:

The committee proposes a package of measures to enhance the Fund's legitimacy and effectiveness, including the formation of a high-level ministerial council to foster political engagement in strategic and critical decisions, acceleration of the quota and voice reform begun last year, a broader mandate for surveillance, clearer lines of responsibility and accountability between various decision-making entities in the Fund, and the introduction of an open, transparent and independent of nationality selection process for the Managing Director.

It’s a good summary for insiders. But what is this report really about? Is the lack of attention to it (for example, not a word in the Financial Times, the serious and candid IMF-watcher) because the report is too little too late, or because, in an effort to actually make headway in official circles, it is appropriately subtle (and subversive)? Here are some facts about it. You decide.

First what the report doesn’t say. Almost nothing at all on the fundamental issue of quotas or votes (i.e., actual power to decide what the IMF does). Except to “bring forward” the current timid reform proposal giving more votes to China and a few other emerging markets, and to hurry up and agree on yet another proposal for more vote changes next year.

Well maybe this counts as a lot in international bureaucratic circles. But if fails to recognize how much the world has already changed, not to mention the further acceleration in change currently underway as a result of the crisis. The committee could have set the tone for more serious discussion by suggesting some examples of sensible changes: for example that China’s quotas/votes should increase from its current 3.7 to at least 9 percent, and that western Europe’s should drop from the current 30 percent to something like what the United States currently has, which is 17 percent. (The G-24 -- finance ministers from developing countries including some too small to get into the G20 -- was recently thoroughly specific, calling for realignments of votes at the IMF and the World Bank to move “towards an equitable voting power between developed and developing countries.”

Second, what the report almost said. Its recommendation for an open, transparent, and merit-based selection process for the head of the IMF (now included also the G-20 Communiqué) regrettably left out the words “without regard to nationality.” Does that omission—which contrasts so strikingly with Strauss-Kahn’s summary of the report in the IMF press release—mean that Europe and the United States have yet to concede that they can no longer run the Bretton Woods Sisters as a trans-Atlantic club (with the Europeans appointing the head of the IMF and the Americans naming the president of the World Bank)? And could it have been an oversight of the meticulous External Relations staff at the IMF that they quote Strauss-Kahn using words that are in fact not in the report?

Third, where the report tried to square a circle with strange arithmetic. On the “voice” issue, the report calls for ending the quaint custom of appointing five chairs for the largest shareholders in favor of all chairs being elected, “which would help consolidate European Union member countries and so achieve a better balance between advanced and emerging market/developing countries.” This also would require an amendment to the charter, so it may go nowhere.

Perhaps it doesn’t matter. A footnote suggests that the idea is to consolidate European representation on the 24-member board without actually increasing developing country representation much, because the board itself would be much smaller. Says the footnote: “Consolidating European chairs – 8 EU chairs going for instance to 2 or 3 – would enhance the voice of the region while making more space for emerging market and developing country directors and allowing (the recommended) reduction in the total number of chairs (from 24 to 20).” The bottom line as I read it: maybe the emerging market and developing countries get one more chair!

The report includes two recommendations that affect directly the U.S. (The two Americans on the committee were Robert Rubin and Kenneth Dam). First, it proposes “lowering the threshold on critical decisions from 85 percent to 70-75 percent.” That would effectively eliminate the U.S. veto (the U.S. has 17 percent of the voting power). Such a change would itself require a revision of the IMF charter, meaning essentially that the U.S. Congress would have to agree to give up the U.S. veto. Perhaps it is buried in paragraph 26 without any indication of its implication to make it less radioactive in the U.S. Congress. Second, it recommends that the same criteria be applied to appointments of the three Deputy Managing Directors at the IMF, and notes the “clear perception – confirmed by practice – of reserving the position of first DMD to the U.S.”

These two recommendations make me surmise that Secretary Geithner, who knows the IMF, was more prepared to support nudging the Fund into the 21st century than the Europeans.

On surveillance, capital market, global imbalances, double majority voting, and other acute sensitivities the Committee was equally circumspect. Perhaps IMF aficionados will weigh in to explain whether the report represents subtle, subversive progress or a missed opportunity.

(The Committee was headed by South African finance minister Trevor Manuel and included a diverse array of prominent and well-respected thought leaders and policy makers (Michel Camdessus, Kenneth Dam, Mohamed El-Erian, Sri Mulyani Indrawati, Guillermo Ortiz, Robert Rubin, Amartya Sen, and Zhou Xiaochuan).