Wolf After Wolf

President George W. Bush has designated Deputy Defense Secretary Paul Wolfowitz as a nominee for the president of the World Bank to succeed current World Bank president James Wolfensohn.

Wolfowitz, who is second in command to Defense Secretary Donald Rumsfeld, is widely regarded as a leading figure in the neo-conservative cult. He is an architect of the Iraq war. His arrogance, ignorance, and incompetence are unbounded. Wolfowitz & Co. predicted that the Anglo-American occupation armies would be greeted with flowers and sweets in the streets of Baghdad and Basra.

Wolfowitz’s succession to the World Bank presidency is likely to move the institution from bad to worse. In his years as the organization’s chief Jim Wolfensohn has paid a lot of lip service to “comprehensive development framework” and civil society but the bank remains a huge international bureaucracy that follows, by and large, the neo-liberal program. In recent years it has embraced dialogue with non-government organizations, the hype about knowledge-sharing, and empowerment.

The respected liberal economist Joseph Stiglitz did bring a fresh air of dissidence to the Bank, but he was quickly shown the door out. That became a typical play during Jim Wolfensohn’s regime at the bank. Other independent-minded people were kicked out or told to tone down their analysis. With Wolfowitz at the helm, the bank’s climate is likely to get worse, not better. It would stifle the scope of independent research, analysis, dialogue and dissidence in the institution.

The Bush administration’s decision to nominate Mr. Wolfowitz as the president of the World Bank is a clear display of its imperial arrogance as well as a show of contempt for international law, diplomacy and peaceful methods of resolving conflicts. This follows its earlier decision to appoint John R. Bolton as the new U.S. ambassador to the United Nations. The administration is dedicated to imposing its neoconservative program on foreign aid program and multilateral institutions with as much zeal as it is to dismantling Social Security domestically in the guise of reform. The U.S. and other advanced countries generally get what they want from international aid programs and multilateral agencies, but the appointment of Wolfowitz is an attempt to make the World Bank even more subservient instrument of the U.S. Treasury and State Departments than it is already.

The nomination of Wolfowitz as president of the World Bank will prove to be controversial, particularly among developing countries as well as America’s European allies. The staff of the bank, many of whom are competent professionals and functionaries and specialists, will be demoralized and insulted by this choice. It is no accident that the administration has picked Wolfowitz rather than an establishment figure or competent manager from the internationalist wing of the Republican Party. Even from the vantage point of narrow interests or conservative principles, it is a bad choice.

The United States is the World Bank’s largest “shareholder.” Unlike the UN General Assembly, where each country has one vote, voting power in the Bretton Woods institutions is allocated on the basis of economic power. The president of the World Bank has always been an American, whereas the managing director of the International Monetary Fund, has traditionally been an European.

The Bush administration’s decision to nominate Mr. Wolfowitz will need to meet approval of the executive board of the bank. The executive board usually rubber stamps decisions emanating from U.S. Treasury. The developing countries have limited clout: borrowers can’t have too much say. The Western Europeans tend to be more interested in sharing the pie. That said, on a few occasions disputes do arise, so it will interesting to see if the Europeans and the developing countries dare to reject Bush’s nominee.

President Bush described Wolfowitz at a press conference as a man of “good experience.” He certainly has a record of service to interests of the powerful and the rich. Wolfowtiz was the U.S. ambassador to Indonesia. The U.S. backed the Suharto regime right until its fall. Wolfowitz served as U.S. Assistant Secretary of State for East Asia. Note how the New York Times and other mainstream media mention how he served in that capacity “during the Philippines transition to democracy” without recalling that President Daddy Bush praised and supported dictator Marcos.

Talks about “Wolfowitz’s drive to spread democracy” should not go unchallenged. The U.S. has been a consistent supporter of tyrants and assorted dictators and monarchs, particularly in the Middle East and West Asia with greater zeal than any where in the planet, in countries like Morocco, Algeria, Egypt, Saudi Arabia, Jordan, and Pakistan. Wolfowitz berated Turkish military generals for the Turkish parliament’s firm rejection of endorsing U.S. invasion of the Iraq war and thus denying U.S. military access to invading Iraq from Turkish soil.

If the principles of law and justice are applicable for the masters of the universe then Wolfowitz, his boss, and his boss’s boss, are certainly international war criminals. They have used massive force against the territorial integrity and political independence of Iraq. They invaded the country and are responsible for killing thousands of civilians. They have endangered international peace and security and have conducted acts of aggressions. They have squashed peaceful Iraqi non-violent opposition to the occupation. They are indirectly responsible for torture and violations of the Fourth Geneva Convention relative to the protection of civilians in Iraq and elsewhere. Such persons should be surely subject to indictment, not election to high offices in international agencies and praise.

Paul Wolfowitz would not, however, be the first war criminal to have served as the president of the World Bank. That distinction belongs to Robert McNamara, U.S. Defense Secretary who went to head the Bank, after directing the slaughter of Vietnamese peasants, napalming that country, and bringing the world to brink of nuclear war during the Cuban crisis. Years later, McNamara apologized—but not to the Vietnamese, only to the Americans for causing them so much pain and suffering. With such distinguished pedigree, Wolfowitz cannot complain about the lack of outstanding role models.

Background Information about the World Bank and its Big Sister

The World Bank’s mandate is to reduce poverty in the developing countries through development assistance. But a large chunk of international aid is to promote rich country’s exports and push the services of high-flying rich country consultants on poor countries. Moreover the level of rich country foreign assistance provided to developing countries remains shamefully and abysmally low. Aid is not necessarily allocated in favor of those who need assistance the most. The high-income members devote on average less than 0.35 percent of their GDP to foreign aid. While some foreign aid programs do have positive effects and have improved the lives of the poor, a lot of foreign aid still goes to propping up favored dictators and corrupt regimes.

The IMF, located across the street from the World Bank headquarter on 18th Street in Washington D.C., is the Big Sister of the World Bank. The IMF is responsible for macroeconomic surveillance, instituting structural adjustment programs and loans. The World Bank supplements the IMF’s goals. Unlike the IMF, the Bank provides sectoral loans, project financing, and technical assistance to developing countries for all kinds programs, ranging from environment, health, infrastructure, energy, trade, information technology, private sector development, capacity building, and gender equality.

Though the critics of the World Bank are correct in many respects, the concept and the principle of genuine transfer resources and knowledge sharing among countries is not really disputed. The World Bank has to be fundamentally reformed to serve the interest of global communities and the poor. But the appointment of Wolfowitz, after Wolfensohn, is bound to do profound damage to the processes of unilateral transfer and the World Bank as a key institution. The Wolfowitz appointment needs to be widely resisted. The progressive community should voice its opposition not just to Wolfowitz but also the present international foreign aid regime.

Abu Spinoza is a pseudonym for an economist.

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