[Terrorism] Wolfowitz attempt to win over critics

Paul Wolfowitz, picked by President George W. Bush to head the World Bank, said on Friday his image as an architect of the Iraq war was an incomplete portrait and he was confident he could win over his critics for the job.

In an interview with Reuters, Wolfowitz said that if confirmed in the post, "I am certainly not going to impose the U.S. agenda on the bank."

Such words are intended to comfort his critics in Europe and elsewhere who fear that he would change bank policies to reflect Bush's foreign and social policies.

The U.S. deputy defense secretary described his critics as "people who don't know me" and said when they once "get to know me they will realize fairly quickly that I'm about a lot more than military issues, about a lot more than just the Iraq war and that a good deal that has been written about me is an inaccurate caricature."

Although his candidacy is contentious because of his part in the Iraq war, Wolfowitz's approval by the bank's board, which operates by consensus, is likely a foregone conclusion.

The United States has the largest voting share on the 24-member board, which represents the 184 member states, and traditionally nominates the bank president.

As part of an intensive lobbying effort to defuse opposition to his nomination and prepare himself for the new bank role, Wolfowitz on Friday met Asian, Saudi and French bank directors in his first meetings with board members.

He still faces interviews with African and other European countries, less enthusiastic about his candidacy. A persuasive communicator, he has called finance ministers and development officials around the world to convince them of his qualifications and assure them of his cooperation.

In the interview in his Pentagon office, Wolfowitz pledged to work closely with nongovernmental groups active in development and poverty reduction.

He also said relations between the World Bank and its sister organization the International Monetary Fund were a "critical issue." The World Bank and IMF are often criticized for overlapping in their work in developing countries.

Wolfowitz said that while there was no single answer to the challenge of terrorism, working to reduce poverty could diminish the terrorist threat.

He described the relationship between terrorism and poverty as complicated, because some leading militants, including the man blamed for the September 11, 2001, attacks on the United States -- Osama Bin Laden -- were wealthy, while the people they recruited often lived in miserable conditions.

Some theorists argue reducing poverty will remove a rationale that propels some people into extremist, anti-Western acts.

"I don't think there is a single answer to the challenge of terrorism" and endeavoring to combat terrorism is not the reason to work on poverty reduction, which has "worthy goals, noble goals in themselves," he said.

But "I think poverty reduction will help" in the war against terrorism, he said.

A former U.S. ambassador to Indonesia, Wolfowitz said he would work to use the bank's economic development tools to strengthen democracy there and elsewhere.

"I do believe that reducing poverty contributes enormously to political development," Wolfowitz said.

Saturday March 19, Online Reuters Report

[Global Poverty] Bank of America

Skeptics have always said the World Bank puts U.S. interests first. They never knew how good they've had it.

Putting Assistant Secretary of Defense Paul Wolfowitz in charge of the World Bank lends credence to the charge by officials in developing countries that the World Bank is nothing more than an instrument of U.S. foreign policy.

Luisa Morgantini, chair of the Development Committee of the European Parliament that reports to the European Directors on the World Bank board, has requested that government officials "ask the U.S. to open up the process to accept other candidates." A network of 48 European nongovernmental organizations (NGOs) is distributing a sign-on statement to their members of parliament asking them to block the nomination. It’s getting 50 signatures an hour, according to Alex Wilks of the European Network on Debt and Development in Brussels.

"World Bank insiders are so depressed," says Mark Weisbrot, co-director of the Center for Economic Policy Research in Washington, D.C.

If history is to serve as an example, the European decision-makers on the bank’s executive board will accept Wolfowitz within the next two weeks. They haven’t rejected a U.S. candidate in 60 years, despite the United States’ rejection of Europe’s candidate (Caio Koch-Weser) for managing director of the International Monetary Fund (IMF), the bank’s big brother, under the Clinton administration.

Wolfowitz would replace 10-year veteran James Wolfensohn. The 1990s saw a lot of countries and activists asking for World Bank leaders to explain how it could be that wherever they were eradicating poverty, poverty was increasing. Joseph Stiglitz, famed Nobel Prize-winning economist, was pushed out of the bank for criticizing that same issue. Wolfensohn has since managed a 180-degree change. In Brazil, for example, a country whose officials have agitated against both the World Bank and the IMF (Brazil’s President Luiz Inacio Lula da Silva was elected in October 2002 in a landslide because the public linked his challenger to the neoliberal policies espoused by both institutions), Wolfensohn had a positive makeover and was photographed dancing with children in the streets. People felt he was sincere about reducing poverty. Who will feel that way about Wolfowitz, one of the chief Iraq War architects and a man who, in December 2003, said that countries not taking part in the war effort should not get reconstruction contracts?

Clinton nominee Wolfensohn has been a Bush administration target for years. The primary objective of Washington’s right-wing policy at the World Bank has been threatened in recent years, with steps being made to honor the demands of poor nations. It has moved a little further away from a command-and-control strategy dictated by Washington. Wolfensohn did not back Wolfowitz’s call for total Iraqi debt cancellation and was not quick to help Baghdad with development loans, either. Wolfowitz signals a return to the command-and-control strategy, and a push to get massive development contracts in the hands of U.S. (and European) corporations.

Some NGOs in the developing world say Wolfowitz’s nomination should be accepted, if not praised, according to Mike Casaus at the Center for Economic Justice in New Mexico. "To them, it doesn’t matter who is running it,” he says. “The worse the person, the better, because it makes it easier to gain support to eventually shut the bank down."

Kenneth Rapoza, "Bank of America", The American Prospect Online, Mar 18, 2005

[Global Poverty] A poor choice for the World Bank

Editorial comment - Financial Times
March 18 2005 02:00

George W. Bush, like the Bourbons, learns nothing and forgets nothing. That is how the rest of the world will view the nomination of Paul Wolfowitz as president of the World Bank. To put the unilateralist architect of the Iraq war in charge of the world's premier multilateral development agency is, many must think, to put a fox in charge of the chicken coop. The nomination does not lack merit. Yet it is objectionable, all the same.

The proposed move of Mr Wolfowitz to the bank has a historical parallel: that of Robert McNamara, US defence secretary at the time of the Vietnam war and bank president from 1968 to 1981. Mr McNamara, like Mr Wolfowitz, was a brilliant man. Mr McNamara, like Mr Wolfowitz, was tarnished by his association with an unpopular war.

Mr McNamara went on to be a dominating and, in many respects, successful head of the bank. Might the same be true of Mr Wolfowitz? That is far from impossible. He is highly intelligent, with wide experience in US public service, not least as US ambassador to Indonesia, the third most populous developing country. He could also expect strong support from the US administration, an invaluable asset for any president of the World Bank.

Not least, the bank needs a head who is tough-minded and willing to set priorities. Mr Wolfowitz is likely to prove considerably superior in these respects to James Wolfensohn, the outgoing incumbent. Mr Wolfowitz is also a far better choice than A.W. (Tom) Clausen, Barber Conable and Lewis Preston, the ineffectual presidents selected by Ronald Reagan and George H.W. Bush.

Yet Mr Wolfowitz is far from the outstanding candidate that the world needs. That he has no financial experience is relatively unimportant. More significant is his lack of experience in the complexities of development.

Yet his biggest drawbacks lie elsewhere. Mr Wolfowitz's comments on the likely costs of the Iraq war and prospective popularity of the invading forces in Iraq put his judgment in question. But, above all, the world would view a bank directed by Mr Wolfowitz as no more than an instrument of US power and US priorities. Every piece of advice the bank gave and condition it set would be made illegitimate, in the eyes of recipients, by the perception that it served the interests of the world's "sole superpower". The impact on the bank's legitimacy would be hugely damaging.

Alas, the Europeans are in a poor position to protest over the process, since they have been so adamant over retaining their right to nominate the head of the International Monetary Fund. They could seek to veto the appointment, as the US vetoed that of Caio Koch-Weser, the German nominee to the Fund, in 2000. But a veto would create vast ill will in the US. More important, it would be far too easy for Mr Bush to put forward a much worse candidate than Mr Wolfowitz. It would be politically impossible for the Europeans to cast a veto twice.

The Europeans should, instead, express dismay over both this candidacy and the lack of consultation that preceded it. The principal vehicle for tackling global poverty should, they must stress, never have been treated as a consolation prize for a disappointed official. Above all, the Europeans should tell the US to obtain the support of developing countries before they, too, accept it. It may now be too late to change the outcome. But the US does at least need to know that a bank that is too visibly subordinated to narrow US objectives will be ineffective, because it will be illegitimate.