The Wolfowitz Bank

Everybody ready for neo-con development politics?

President Bush said today he is nominating Deputy Secretary of Defense Paul D. Wolfowitz to be the next president of the World Bank, tapping one of his administration’s most controversial figures as the U.S. choice to head the 184-nation institution.

Because, y’know, after engineering a military quagmire in Asia, Robert McNamara was such a smashing success at the World Bank…

Or will it be a Koch-Weser moment?

UPDATE: Bloomberg comes through with a bit of the agenda.

Under Wolfowitz, the Bush administration may now try to narrow the focus of the World Bank, returning the international lending institution to its roots of primarily financing large infrastructure projects and limiting the practice of handing out zero-interest loans, analysts such as Alan Meltzer, who led a 2000 congressional inquiry into the World Bank, said.

Tapped also has scuttlebutt from 17th & H; in short, Wolfowitz will be hated by the institution he is slated to run.

On Monday, I was in the audience when a reasonably senior US diplomat speculated on improvements in US-European relations. I thought to myself, well, things will get a hell of a lot better on Jan. 21, 2009.

42 thoughts on “The Wolfowitz Bank

  1. Wolfowitz is a key architect in the Bush administration’s plan for spreading democracy throughout the world. As Salon (www.salon.com/politics/war_room/#wolfowitz) makes a good point of mentioning, “Wolfowitz doesn’t have development experience, but you can see how, as World Bank president, he would fit in to the broader Bush administration goal of ‘spreading democracy’ throughout the world.”

    Similarly, like John Bolton to the UN, Bush’s appointments aren’t about playing nice with the international community. It’s about American hegemony and ensuring the American agenda is implemented abroad, whether through war or through the conditions of loans to developing countries

  2. From the Koch-Weser link:
    Another concern for Clinton is that Germany might be tempted to use the IMF chairmanship to deal with some of its own financial woes. “Germany is the central bank for the Euro, which has just dropped below the dollar,”

    So with the dollar at 1.34 to the euro might the US be tempted to use the World Bank chairmanship to deal with some of its own financial woes?

  3. Yeah, I suspect that this is an effort to retire Wolfowitz the same way it was for McNamara – screw up a war, get sent to the World Bank, and maybe sabotage another Euro-American institution in the process. With the reputation the World Bank has right now, I’m hard pressed to think of worse candidate to lead reforms. Especially since Wolfowitz is a political wonk with no experience in development economics.

    McNamara led the World Bank on a catastrophic program of dam building in the third world, providing hydro-electric power to industries that never materialised. It endebted poor countries without adding cent to their treasuries, especially since overseas firms did pretty much all of the contruction. It also caused quite a lot of ecological damage. I forsee a Wolfowitz presidency as embarking on the same sort of stupid program.

    The IMF makes stabilisation loans to developed and underdeveloped countries. It’s intent was always to prevent unstable currency movements. The World Bank was always about development loans to countries in trouble. For the US to try to extract loans from it is very, very unlikely. For Germany to use the IMF to adjust exchange rates is unlikely, but a bit more plausible. I don’t think there is a serious US intent to manipulate the World Bank in this. It’s just not that powerful an institution in the developed world, and Bush has no economic agenda for the underdeveloped world. For Bush – which has totally subsumed foreign policy to domestic concerns – the post is just a sinecure for a loyal henchman.

    The US has only 15% of the vote at the World Bank. Hopefully, the remaining 85% will be less impressed. The problem is that the US names all the candidates for the post – that is an informal institutional requirement.

  4. Ah jeez. It’s worse than that. Bloomberg claims that the Bushies want the World Bank to back into exactly the same kind of disasterous infrastructure projects that got them into this mess. Can we say “contracts for Haliburton”?

  5. It’s probably only a malicious rumour but I did hear the Whitehouse is shortly going to announce who the next Pope will be. According to my source, Donald Rumsefeld is being lined up for the job.

    After all, with Guantanamo Bay and Abu Ghraib, it has to be recognised that Rumsfeld has become something of a political liability to the Bush administration so a career development move would be constructive step forward and his presence in the Vatican would ensure a more sympathetic response there for the American position as well as a warm welcome when President Bush comes visiting. Downing St were said to consider the news “an interesting suggestion.”

  6. It’s a risk, but it could pay off. Wolfowitz is not a “stability for stability’s sake” guy, and if you’re saying that incorporating the spreading of democracy into the World Bank is going to unconditionally increase poverty, I find that to be a stretch. It may, or it may not, depends on the method. The truth is that, forget McNamara, the World Bank hasn’t had a great record in the last ten years either, what with all the attempts at privatization. Maybe this has something to do with it being a US outfit, but at least now no one is trying to sugarcoat it as otherwise. The UN says that the US is ignoring the root causes of terrorism, ie poverty. Then when they believe that the US is incorporating the World Bank into their policies, in other words, when the US ties the war on terror with poverty, they all get uncomfortable. Odd, no?

  7. I think we can be pretty sure that the governments of all those perennially ungrateful deeply impoverished countries will be more careful about criticising President Bush in case their applications for World Bank loans get stuck in the bottom draws of filing cabinets.

    All this fuss about a little bit of torture: every reasonable person agrees that torture can save lives when information about terrorist acts is withheld from security services. The local difficulty is that the security services don’t and can’t know in advance whether anyone is withholding information which could save lives – they need to torture anyone to find out whether the know something which could save lives and, as we know, the Bush administration is utterly opposed to discrimination.

  8. I thought to myself, well, things will get a hell of a lot better on Jan. 21, 2009.

    Heh,
    Only if Bush doesn’t gets the votes that would allow Replicans to repeal the 22nd amendment.

  9. Hilarious. Nothing like a ‘Neocon’ to bring the FFOE trolls out of the woodwork. It’s very telling that after dozens of posts celebrating the Ukranian Orange Revolution, FFOE virtually ignores everything that’s been happening in the Middle East. Because that would be vindicating American foreign policy. Wolfowitz was wrong about the details, but he got the big picture right. FFOE is all negative. Keep it up though.

    For a more balanced view, y’all might want to try reading something other than Le Monde, The Guardian, and La Vanguardia.

    Here some help:

    Wall Street Journal:

    “Upon such terrain Mr. Wolfowitz’s parachute now lands. He should be prepared for some stiff resistance to his reforms, including high-level departures to whatever is the World Bank equivalent of Canada. But so be it: The Bank can hardly demand good governance of its client states if it is incapable of imposing some internal standards and controls.”

    Washington Post:

    “It’s also right, though, for the World Bank to promote some democratic virtues — openness, accountability and other anti-corruption measures — that underpin economic development. And in the long term, economic development and the creation of a middle class do tend to foster democracy. If he can lead the World Bank successfully, Mr. Wolfowitz will ultimately be promoting the cause with which he is most identified.”

    Los Angeles Times:

    President Bush’s nomination Wednesday of neoconservative Deputy Defense Secretary Paul Wolfowitz to run the World Bank is predictably infuriating critics of the Iraq war. Already Wolfowitz is being likened in the New Republic and elsewhere to Robert McNamara, the Vietnam War architect who went on to mismanage the World Bank and mire the Third World in billions of dollars of debt.”

  10. We shouldn’t overlook this from the Reuters Foundation?

    “An official US audit has unearthed evidence of widespread corruption in postwar Iraq, finding that the occupying authorities failed to keep track of nearly $9 billion (?4.8billion) of Iraq?s oil and other revenues.”
    http://www.alertnet.org/thenews/fromthefield/218275/110736089491.htm

    At least the Bush administration is suitably appreciative of Tony Blair’s unstinting efforts on their behalf: http://www.thankyoutony.com/

  11. I thought to myself, well, things will get a hell of a lot better on Jan. 21, 2009.

    Hmm, I wonder how you’ll react if Condoleezza is elected.

  12. Condoleeza Rice running for Pres. ?

    If she runs against Hillary Clinton, it would a face -off between two Presidential wives.

    I think I’ll take both at their word that they’re not running in 2008.

  13. This may come as a shock to Euros, but…

    http://www.nysun.com/article/10560

    ‘In Beirut yesterday, it was clear that message has been heard. Unlike the Hezbollah demonstrators with their chants of “Death to America,” many in the crowd were friendly to Americans. “Thank’s Free World,” (sic) said one poster, held high by a woman in a bright red jacket, Rawya Okal, who told me: “We thank Mr. Bush for his position.” Overhearing this in the throng, a middle-aged man in a green baseball cap, Louis Nahanna, leaned over to say, “We love the American people” – adding, “Please don’t let Bush forget us. Your support is very important.”‘

    ‘Asking more people what they thought of Americans turned up the same refrain. From a young driver, Fadi Mrad, came the message: “We want to change. We need freedom. Please don’t let Bush forget us.” From a group of young men came not only the message “Our hope is America,” and “We believe in democracy in the Middle East,” but also praise for Deputy Secretary of Defense Paul Wolfowitz. There was also an invitation from one of them, young Edgard Baradhy, for his heroine, Ms. Rice, to come to Beirut “and I am ready to take her for coffee.”‘

  14. Michael, I’ll be shocked if you get an answer than the text equivalent of being spit at.

  15. Well Bob (not B), I was just blinded by the rose petals the Iraqis were tossing at the feet of our soldiers, welcoming them as liberators. Or maybe it was the dazzling recognition of all the WMDs that have been found, truly justifying the 1,500 American dead and the many billions added to our deficit, since cutting taxes every year is, y’know, more important than actually paying the government’s bills. Or maybe it was OBL’s head on a pike, paraded on every news channel around the world, after he was rousted from one of Saddam’s palaces. Or maybe it was the shining example of Republican foreign policy, abjuring torture anywhere, anytime by anyone. Or maybe it was the brilliant example of planning for the postwar occupation, drawing on the best knowledge of experts, getting Iraq’s institutions running again in a matter of weeks, sometimes days. Or maybe it was the exquisite care the advancing army took to guard stockpiles of weapons and explosives, so they couldn’t be put to nefarious uses later. Or maybe it was the example set by Republican leaders, who refused to blame low-level people for the minor problems that emerged and instead insisted on responsibility at the very highest levels. Or maybe it was the White House’s refusal to expose clandestine agents, even when it appeared doing so might aid their political case. Or maybe it was the remarkable recovery of Iraqi oil production, strong enough to pay for reconstruction without any input of cash from abroad.

    Yeah, I’ve been pretty much blinded by all of these things.

  16. Though you can get a view of the reaction a “neocon” European over at http://www.melaniephillips.com/diary/

    The news that President Bush has nominated Paul Wolfowitz to run the World Bank has sent the appeasement crowd into a frenzy. Hardly had they got over the shock that John Bolton, the abrasive UN critic, had been appointed ambassador to that nest of vipers than the intellectual architect of the Iraq war himself was now being put up to run international development. The idea that, as a result, the tyrants and dictators who have used the UN to foment global terror might be held to account for the first time, and that international aid might no longer be used to line the pockets of said tyrants and dictators thus financing said global terror, is regarded of course by the appeasement crowd as the end of the world as they know it. Cause for a double dose of garlic to wave in the direction of these iconic princelings of darkness. The Guardian’s leader contains a particularly priceless observation about Wolfowitz:

    ‘Some worry that his strong emphasis on human rights may complicate relations with China.’

    Thus the ‘progressive’ position on tyranny and oppression….

  17. “Before examining whether there is any value to these claims, it must be pointed out that the Bush administration did not invade Iraq to spread democracy. The justification for the war was that Saddam Hussein had weapons of mass destruction and links to al-Qaida — both of which claims have proved to be false.” …

    “Practically speaking, there are only two plausible explanations for Bush’s alleged influence: direct intervention or pressure, and the supposed inspiration flowing from the Iraq demonstration project. Has either actually been effective?”

    “Is Iraq even really much of a model? The Bush administration strove to avoid having one-person, one-vote elections in Iraq, which were finally forced on Washington by Grand Ayatollah Ali Sistani. Despite the U.S. backing for secularists, the winners of the election were the fundamentalist Shiite Dawa Party and the Supreme Council for Islamic Revolution in Iraq. Nor were the elections themselves all that exemplary. … The security situation was so bad that the candidates running for office could not reveal their identities until the day before the election, and the entire country was put under a sort of curfew for three days, with all vehicular traffic forbidden.” …

    “Pro-Bush commentators dubbed the Beirut movement the “Cedar Revolution,” but Lebanon remains a far more divided society and its politics far more ambiguous than was the case in the post-Soviet Czech Republic and Ukraine.

    On March 9 the Shiite Hezbollah Party held massive pro-Syrian demonstrations in Beirut that dwarfed the earlier opposition rallies. A majority of Parliament members wanted to bring back Karami. Both the Hezbollah street demonstrations and the elected Parliament’s internal consensus produced a pro-Syrian outcome obnoxious to the Bush administration. Since then the opposition has staged its own massive demonstrations, rivaling Hezbollah’s.

    So far, these demonstrations and counterdemonstrations have been remarkable in their peacefulness and in the frankness of their political aims.”

    http://www.salon.com/opinion/feature/2005/03/16/democracy/

  18. Ah yes, I had forgetten that the most important job of a diplomat was to be as offensive to those he has to deal with as possible. And of course, I have so inexcusably missed out on that fine, Pulitzer Prize winning Middle Eastern coverage from that bastion of Conrad Black’s crusade to raise journalistic standards, the NY Sun.

    It’s amazing how criticising a neo-con with a history of fibs, misstatements and political manoeuvring of the kind Stalin used to be famous for – and suggesting that he will do all the same things at his new job that he has at his old one – brings out the trolls.

    The man’s economics experience consists of running a toy company. (And not running it particularly well, I might add. Hasbro made a profit the first year he was in charge. It took a loss the last year and lost 10% of its market share, despite an aggressive campaign of acquisitions.) His experience running large goverment organisations seems to consist of overruling people far more experienced and competent than him and then watching it make a mess of the task he put before it, and then taking absolutely no responsibility for it.

    And this is exactly the kind of man to bring discipline and responsibilty to the World Bank? He’s a more complex character than he appears to be – that I’ll grant – but that doesn’t change that he is simply no damn good. He hasn’t exactly shone in any of the posts he’s held, and his reputation is in the toilet. He has absolutely no credibilty, and any repuation he may have had as an intellectual has long since been destroyed by his involvement in the Bush government. This is either a calculated insult, an intentional effort to destroy the World Bank, or another example of how Bush really doesn’t care about the rest of the world.

    Bono would have been a better choice. At least his businesses make money.

  19. It’s amazing how criticising a neo-con with a history of fibs, misstatements and political manoeuvring of the kind Stalin used to be famous for – and suggesting that he will do all the same things at his new job that he has at his old one – brings out the trolls.

    Funny how you can pull out the massive big lie smear and call other people trolls at the same time. No sense of irony here.

  20. “Pentagon auditors have found that the Halliburton Co., which was awarded a no-bid $2.5 billion contract to deliver fuel to Iraq, may have overcharged by more than $108 million. That includes $61 million auditors found in questionable charges more than a year ago. . . Yet another Pentagon audit completed last August and obtained by NBC News found that a Halliburton contract to provide food and housing for American troops had a staggering $1.8 billion in unsupported costs.”
    http://msnbc.msn.com/id/7201320/

    Is any comment necessary?

  21. Bob B, I’d comment that obviously the Pentagon has an auditing process that catches even it’s big contractors when they try to cheat.

    I wonder how many countries are willing to have honest audits of companies in analogous positions.

  22. It’s amazing how criticising a neo-con with a history of fibs, misstatements and political manoeuvring of the kind Stalin used to be famous for – and suggesting that he will do all the same things at his new job that he has at his old one – brings out the trolls.

    Hah! It get’s better! Now Wolfowitz = Stalin( who was responsible for what, 20,000,000 deaths? ). Next your going to say Bush = Hitler. See the ‘Small Public Service Announcement’ below for announcing your tired, flacid cliches.

    Yeah, I’ve been pretty much blinded by all of these things.

    And yet despite all these ‘things’, his domino theory is proving correct hence conclusion of the big picture. If your looking for perfection, you ain’t gonna find it. History will prove whether this was a honorable and wise undertaking. All things considered, I’d say things are looking bright.

  23. Joshua, in other countries, people go to jail for goverment contracting fraud – which is one of the reasons this sort of thing hasn’t happened so often lately in other reasonably transpartent countries lately. NATO members all have auditing and review procedures for military procurement programs. And, yes, they do audit their major contractors. In the UK, there was a fuss just last fall about procurement procedures.

    Try again.

  24. Bob, I’ll stop calling them Stalinists when they stop telling big lies.

    I’m afraid your belief in the domino theory is about as convincing as it was back in the 70’s when it was McNamara’s idea. Talk about tired, flacid clichés, you can’t pick a bigger, older ideological loser than that one. C’mon!

  25. Bob, I’ll stop calling them Stalinists when they stop telling big lies.

    Okay, so (big)liars are Stalinist. That’s sophisticated.

    I’m afraid your belief in the domino theory is about as convincing as it was back in the 70’s when it was McNamara’s idea. Talk about tired, flacid clich?s, you can’t pick a bigger, older ideological loser than that one. C’mon!

    Well, the Domino Theory is grounded in reason and logic. Equating Wolfowitz to Stalin because he tells, erm , ‘big’ lies is an emotional, childish tantrum. Furthermore, I have evidence to back up my cliche. You have none. How could you?

  26. Scott, I’m not surprised that Britain matches the United States in transparency but I doubt the US and Britain are the rule.

    You’ll be outraged that I said that they match, but you know, they both do audits and find problems, so in both cases the system is working.

  27. US democrats and European observers would be much more effective if they joined into the current and dynamic changes happpening in the world, istead of fighting tooth and nail (ineffectively I might add) in hopes of gaining selfish long term political and economic advantages.

    When William Bryon Jennings threatened to sweep the democratic electorate away, the Democrats simply adopted his policy .. and continued their dominant role in American politics.

    That is my advice. Join, participate, be involved with the changes, be effective and helpful..take lots of credit yourselves, and from your inside position, criticize all that the administration did … and all the areas it ignored.

  28. Bob, of what, the big lies? Like those missing WMD? You’ve provided nothing in the way of evidence of anything. Heck, you haven’t even acknowledged that I provided actual reasons to think ill of Wolfowitz. You’ve called me childish and emotional and accused me of having a tantrum. You’ve called everyone here “FFOE trolls”. And I haven’t called you anything at all.

    Do you see that you are demonstrating exactly the characteristics one most expects from an asshole? Ad hominem, non-responsiveness to reasoning, unsubstantiated and unargued claims, blockquoting in comments… Are you able to recognise the difference between what you are doing and actually making a case for your beliefs?

    An actual argument invovles a claim and supporting evidence. For example: Paul Wolfowitz will make a very bad choice of World Bank president. This is because: He has been in substantial part responsible for managing a very poorly managed war; he mismanaged the business he ran for six years; he has spouted a lot of nonsense about the Middle East and about Iraq, so no one believes him anymore. Ergo, he is a bad choice.

    You see? It’s not all that complicated. It’s called rhetoric and in Europe, they actually teach it in schools. Now, Bob, I don’t know where you went to school (or if you did) but I can only assume that it wasn’t taught wherever you came from. So, I hope this has been a valuable lesson to you in communicating through blogs. We here at AFOE believe strongly in giving back to the web community through improving the quality of discourse.

  29. Now Scott, does calling Bob “an asshole” count as an ad hominem attack? How about your laundry list of slurs against Mr. Wolfowitz?

    My earlier observation that you lack all sense of irony holds.

  30. Joshua, I’ll believe the American system is working when I see Haliburton employees face charges for fraud. In Europe, it is generally quite ill-viewed for senior government figures to be so closely attached to goverment contractors.

    I have not called Bob an asshole, I merely noted the manner in which his approach is likely to be perceived. You, I’m afraid, lack any sense of humour or sarcasm. And as for the ad homina, you’re treading on thin ice already having slagged the writers here several times in one thread. Your claim that I lack a sense of irony seems, in context rather ironic, since you have contributed nothing whatsoever here that resembles an argument – just a bit of, frankly, weak pith and a blockquote – and then proceed to accuse the hosts of your comments of poor form. This is less of an offense than Bob’s, but it is well on its way to, say, intermediate wankerhood.

    Craig, years of American Democrats taking it up the butt has not done a whole hell of a lot for their effectiveness, and I rather appreciate the way most European governments have chosen not to follow the same path of appeasement. I suppose one might argue that simply agreeing with everything Bush does might give the appearance that the cowering fools who do so are, in some way, getting what they want. But that’s quite far from being “effective”.

  31. There are some sorts of arguements I don’t have time for, and I’ve seen nothing here that promises a level of insight worth my trouble… So yes you’re right I’m not bothering to argue. You haven’t earned enough respect to be worth the trouble or the time.

    After reading your spew I have to admit that I don’t mind not getting your approval. You’re not a master of any sort of discourse I would want to emulate.

  32. Anyway, Scott if the emotion-blinded overheated sarcasm bordering on insane rant you specialize in is what the British school system is teaching as “rhetoric”, then you need reform your school system.

  33. Your such a fragile creature, Scott. Ad-hominem? Asshole? What?

    Anyway…. Lies are willfull deceptions. Certainly Wolfowitz has made mistakes. But lies? No. You haven’t, imo, made a rational statement as to why you oppose Wolfowitz, other than he ran a toy company poorly, ignoring the fact that he never ran a toy company, but whatever. He was on the board of directors at Hasbro with about 13 other people The CEO runs the company Scotty. You would know this if you took a basic economics class.

    years of American Democrats taking it up the butt has not done a whole hell of a lot for their effectiveness

    Ah the superiority of European rhetoric. 😉

  34. “Bob B, I’d comment that obviously the Pentagon has an auditing process that catches even it’s big contractors when they try to cheat.”

    Wonderful.

    “The Department of Defense, already infamous for spending $640 for a toilet seat, once again finds itself under intense scrutiny, only this time because it couldn’t account for more than a TRILLION [emphasis added] dollars in financial transactions, not to mention dozens of tanks, missiles and planes. . . A GAO report found Defense inventory systems so lax that the US Army lost track of 56 airplanes, 32 tanks, and 36 Javelin missile command launch-units. . . ”
    http://www.sfgate.com/cgi-bin/article.cgi?file=/c/a/2003/05/18/MN251738.DTL

    Unfortunately, the audit didn’t locate the whereabouts of the missing Trillion Dollars or the 56 airplanes, 32 tanks, and 36 Javelin missile command launch-units.

  35. B.B. I have to ask, does this rant of yours have anything to do with Paul Wolfowitz becoming president of the World Bank, or does it just make you feel better?

  36. scott wrote
    It’s amazing how criticising a neo-con with a history of fibs, misstatements and political manoeuvring of the kind Stalin used to be famous for – and suggesting that he will do all the same things at his new job that he has at his old one – brings out the trolls.

    Bob wrote:
    Hah! It get’s better! Now Wolfowitz = Stalin( who was responsible for what, 20,000,000 deaths? ). Next your going to say Bush = Hitler. See the ‘Small Public Service Announcement’ below for announcing your tired, flacid cliches.

    Scott wrote
    Bob wrote
    Hitler wrote a book
    I write this

    therefore

    Scott=Bob=Hitler=me

  37. Godwin’s law.

    Thread closed.

    (Let me add that a number of visitors are treading on thin ice and encourage them to brush up on their manners.)

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