Wolfowitz and Global “Democracy”: a Test of Blair’s Commitment to the Africa Commission

David Woodward, New Economics Foundation, 18 March 2005

The convention by which the US Administration is left to nominate the President of the World Bank and the European countries the Managing Director of the IMF, is a historical anomaly dating from the 1940s, when the Bank and Fund were founded. Even then – when much of the developing world remained under colonial rule – this was at best highly questionable. In the 21st century, it is an anachronism wholly incompatible with any aspiration towards a democratic world order.

The US represents just 4% of the population of the World Bank, yet they, and they alone, get to decide who will head it. It is like the right to choose the Chancellor of the Exchequer being given permanently to Westminster Council. In fact, it is much easier for the US President to appoint the head of the World Bank than to make his own Ministerial appointment. To be appointed Agriculture Secretary, for example, a nominee must go through months of in-depth Congressional scrutiny, in public. The appointment of the US nominee as World Bank President generally takes a single meeting of the Bank’s Executive Board, lasting a few hours, behind closed doors. It is by no means unknown for the President’s domestic nominations to be rejected by this process; the US nomination for the World Bank Presidency never has been.

The nomination by the current US Administration of Deputy Secretary of Defence Paul Wolfowitz is a gross abuse of this quasi-feudal privilege. He is wholly unqualified and inappropriate to head the International Bank for Reconstruction and Development. He is anything but an internationalist, he has no experience of banking or development, and his experience of reconstruction is limited to his role in the disastrous post-war effort to rebuild Iraq following its destruction in a war which he played a major role in instigating. Robert McNamara, President of the World Bank from 1968 to 1981, may have played a central role in the Vietnam war as US Secretary of Defence; but his Presidency is generally seen as an act of contrition – and there is little sign of contrition on the part of Mr Wolfowitz.

It is difficult to interpret Wolfowitz’s nomination other than as an attempt to hijack the World Bank and turn it into an arm of US foreign policy, leaving the rest of the world to pick up most of the bill. Following on the heals of the appointment of US Agriculture Secretary Ann Veneman as head of UNICEF, this looks very like the beginning of a process of cooption, by all means necessary, to the agenda of the US far right.

What makes this still more frightening is the growing suspicion that the Republicans may have rigged the last election. Evidence that electronic voting systems used in the elections, coupled with a systematic pattern of discrepancies between the official results and exit polls in the states which used them, does not prove this, but at least suggests an urgent need for further investigation¹. In combination with the Bush Administration’s evident intention to put its henchmen at the head of international institutions, this raises the spectre of something approximating a coup at the global level.

The “right” of the US to nominate the President of the World Bank has no legal basis; and the current Administration, through this flagrant abuse of the convention, has forfeited any claim the US might once have had to this privilege. The governments of other developed countries – who have the majority of the votes in the World Bank, due to its undemocratic “weighted” voting system – can and must take the opportunity to oppose this nomination. Developing countries should also resist the threat of political and economic pressure to go on acquiescing in this anachronistic and undemocratic convention – as they are fully entitled to do – by proposing their own, more suitable candidate.

The next four years will be a critical time for development, and particularly for the achievement of the Millennium Development Goals. If we are to have any chance of reaching these goals by 2015, as planned, we need a massive acceleration in progress – and the World Bank will need to play a key role in this. This is not the time to give the most important job in development to an untried novice in development, whose motivation and commitment can only be regarded as questionable, and at best to wait while he learns the ropes.

If the international community are willing to stand aside and allow such a wholly inappropriate and politically-driven appointment to such a critical position at such a critical time, how can he expect anyone to believe their profession of support to the Millennium Development Goals?

In the UK, Mr Wolfowitz’s nomination is a litmus test of how serious Mr Blair is in his commitment to the Africa Commission, which he established and chaired, and on which two of his Ministers (Gordon Brown and Hilary Benn) served.

The Africa Commission’s Report, published only a week ago, proposed that “Appointments of the heads of international institutions should be decided upon by an open competition which looks for the best candidate rather than by traditions which limit these appointments by nationality”. Even President Bush, in announcing Mr Wolfowitz’s nomination, made no pretence that he was the best candidate for the job, and struggled (unsuccessfully in the view of most outside the American far right) even to argue for his suitability.

If Mr Blair shows himself willing to ignore even this most basic and reasonable of his own Commission’s proposals, even in the face of such blatant abuse of the current system, how can he expect others to take it seriously, or to see it as anything more than a cynical PR exercise?

¹Michael Meacher: “Did Dubbya Rig the Election?” New Statesman, 29 November 2004, pp 22-23.