Bush taps defence hawk for helm of World Bank

George W. Bush wants Paul Wolfowitz to shake up the venerable World Bank. Defying intense criticism inside and outside the World Bank, the U.S. President tapped Mr. Wolfowitz, 61, yesterday to replace Australian-born James Wolfensohn as head of the developing-world lender. Critics warned that Mr. Wolfowitz, one of the Bush administration's leading neoconservative thinkers, could face a backlash if he tries to use the bank as a tool to remake the developing world in the image of the United States, by tying grants to political reforms. A former World Bank executive, who spoke on condition of anonymity, said insiders are shocked by Mr. Wolfowitz's nomination, pointing out that it will be tough for him to live down his role in the Iraq war.

Bush taps defence hawk for helm of World Bank
By BARRIE MCKENNA
Thursday, March 17, 2005 Page A18

WASHINGTON -- He helped craft the Bush administration's bold plan to democratize the Middle East, and now George W. Bush wants Paul Wolfowitz to shake up the venerable World Bank.

Defying intense criticism inside and outside the World Bank, the U.S. President tapped Mr. Wolfowitz, 61, yesterday to replace Australian-born James Wolfensohn as head of the developing-world lender.

Mr. Bush praised Mr. Wolfowitz as "a man of good experience" who would make a strong World Bank president. He immediately began selling his star candidate in a round of telephone calls to world leaders, including Italian Prime Minister Silvio Berlusconi and French President Jacques Chirac.

Critics warned that Mr. Wolfowitz, one of the Bush administration's leading neoconservative thinkers, could face a backlash if he tries to use the bank as a tool to remake the developing world in the image of the United States, by tying grants to political reforms.

A former World Bank executive, who spoke on condition of anonymity, said insiders are shocked by Mr. Wolfowitz's nomination, pointing out that it will be tough for him to live down his role in the Iraq war.

The executive said the Bush administration already throws its weight around the bank's headquarters, located just a few blocks from the White House and the U.S. Treasury Department in downtown Washington.

"Mr. Wolfensohn was trying to build bridges between North and South," the executive said. "It's difficult to see how Mr. Wolfowitz will fit into that agenda."

Said Sebastian Mallaby, author of the recent book on the World Bank, The World's Lender: "He's closely associated with the idea that you can advance freedom in the developing world. Translating that mission to the World Bank would be a mistake."

Others decried Mr. Wolfowitz's lack of banking or development experience, as well as his close association with the contentious decision to invade Iraq.

There are hints that some of the bank's 184 member countries may try to derail the appointment. French officials suggested other choices may be on the table.

But it's a long shot. By convention, the World Bank job goes to a U.S. choice, while the Europeans nominate the head of the International Monetary Fund, the bank's sister lending agency.

Mr. Wolfowitz's appointment comes just a week after Mr. Bush picked long-time United Nations skeptic John Bolton to be its new UN ambassador, confirming the administration's utter "contempt" for the international community, said Njoki Njoroge Njehu, director of the 50 Years Is Enough Network.

"This appointment signals to developing countries that the U.S. is just as serious about imposing its will on borrowers from the World Bank as on the countries of the Middle East," he said.

The Bush administration has had a sometimes rocky relationship with the bank and its long-time president, Mr. Wolfensohn, who was picked by former U.S. president Bill Clinton and had sought another five-year term.

Conservatives have long argued that the U.S. government has been getting a poor return on the billions of dollars it has sunk into the bank over the decades. The Bush administration has pushed hard for the bank to get out of the lending business and provide outright grants.

Max Boot, a senior fellow at the Council on Foreign Relations in New York, complained that the World Bank has become too "fat and happy," and has created a "culture of dependency" among borrowers.

"Wolfowitz is a hard-hearted realist who will take on an organization filled with starry-eyed do-gooders," Mr. Boot said. "This is an organization that's in need of reform, and he'll whip it into shape, instill a bottom-line sort of culture and make the World Bank as effective as it was at the outset."

Mr. Wolfensohn was apparently taken aback by the nomination. Just a week ago, Mr. Wolfensohn suggested his successor must be "passionate about fighting poverty," while insisting that Mr. Wolfowitz was out of the running. The clear implication was that Mr. Wolfowitz did not meet that test.

The bank's 24-member board must still vote on Mr. Wolfowitz's appointment, but it is largely a formality.

Yesterday, Mr. Wolfensohn was sounding more diplomatic about his would-be successor, praising him as "a person of high intellect, integrity and broad experience in both public and private sectors."

As much as anything, Mr. Bush may be giving Mr. Wolfowitz the job to help him rebuild his reputation after the heat he has taken over Iraq, said Rick Barton, a senior adviser at the Washington-based Center for Strategic and International Studies and a former top U.S. development official. "In a way it's a better fit than where [Mr. Wolfowitz] has been before," Mr. Barton said. "He's passionate about humanitarian and political development, and that could probably be strengthened at the World Bank."

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