| | World
Bank Presses Inquiry on Economist Who Dissents
By Joseph Kahn 7th
September, 2001.The
World Bank is conducting a disciplinary investigation of one of its highest-ranking
economists, who sharply criticized the bank's record on fighting poverty in a
recent book and newspaper opinion article.
The economist, William Easterly, came under investigation by the bank's office
of business ethics and integrity after he wrote an article in The Financial Times
that summarized views expressed in his book, several bank officials said. They
said the inquiry, which has not yet concluded, was started because Mr. Easterly
did not receive the required permission to write an article in a general-interest
publication.In the article and the book, Mr. Easterly harshly assessed the bank's
half-century history of fighting poverty, arguing that it has pursued a long list
of failed elixirs and systematically ignored the poor results of its programs.He
said the bank should encourage countries to adopt traditional free-market policies
and stop lending to corrupt and incompetent governments.The investigation of Mr.
Easterly, which a bank spokeswoman described as a routine enforcement of the World
Bank's media and communications policies, is being conducted at a time when its
president, James D. Wolfensohn, has come under attack from numerous critics.Right-wing
economists say he has led the bank far astray of its traditional mission to enhance
economic growth around the world, while those on the left say the bank under his
leadership remains a top- down institution that does too little to respond to
the needs of the poor. Critics have also put pressure on Mr. Wolfensohn to forgive
more third world debt.Several bank officials said that Mr. Easterly's case is
one of several recent examples of how Mr. Wolfensohn has sought to assert more
control over a raging debate within the bank as he battles outside critics. The
timing of the dispute is particularly sensitive because thousands of protesters
are expected to gather in Washington later this month at the annual meetings of
the bank and the International Monetary Fund to oppose the way the lending institutions
do business.Some protesters argue that the bank and the I.M.F. have failed to
alleviate — and may have worsened — poverty in developing countries. Environmental,
human rights and social activist groups have also sought to force the bank, which
is controlled by member governments, to disclose more documents and allow the
public to express views about policies before they become final.Separately, President
Bush and his top advisers have pressed the bank to rethink its antipoverty strategy.
Mr. Bush proposed replacing as much as half of the bank's loans to developing
countries with outright grants, a change that the World Bank leadership has resisted.Two
influential opinion journals, Foreign Affairs and Foreign Policy, have lengthy
articles in their most recent issues that question the direction Mr. Wolfensohn
has taken the bank. Although many of its critics have conflicting views about
what is wrong with the bank and what should be done to fix it, the flurry of internal
dissent and outside attacks have sapped morale and created a sense of crisis,
several people who work there say. One close supporter of Mr. Wolfensohn said
the bank was "under attack by the forces of reaction," who are trying to undo
the changes Mr. Wolfensohn has brought since he took office six years ago.Mr.
Easterly's views are among the most pointed. As a senior adviser in the bank's
research group, he has helped shape antipoverty strategy for 16 years.In his recent
book, entitled "The Elusive Quest for Growth," Mr. Easterly argues that the World
Bank has systematically failed to raise growth rates in the countries it seeks
to help. He wrote that two generations of bank leaders have been deluded by supposed
panaceas for growth, like increasing business investment, improving education,
limiting population growth, changing government policies and forgiving past loans,
all of which ultimately failed to raise growth rates.The developing world, including
Africa, Latin America, South Asia, East Asia outside Japan and former Communist
nations in Europe, grew at an average annual rate per capita of 0.1 percent from
1980 to 2000, according to the bank's statistics. East Asian nations grew relatively
quickly, but in the other regions, living standards declined."Consider the facts
and it soon becomes evident," Mr. Easterly wrote in the op-ed page article, "that
the $1 trillion spent on aid since the 1960's, with the efforts of advisers, and
foreign aid givers, have failed to attain the desired results."He proposed that
the bank instead focus on creating incentives for poor countries to adopt free-market
policies, largely by halting loans to nations that do not manage their economies
effectively and increasing loans to those that do.Mr. Easterly declined to comment
on his views or the bank's investigation.The agency's chief spokeswoman, Caroline
Anstey, said it supports Mr. Easterly's right to publish his book. She said the
inquiry into his newspaper article followed standard practice, and was not intended
to suppress dissent."This isn't about academic freedom," Ms. Anstey said. "Our
guidelines state simply that staff need to inform their managers of contacts with
the press, preferably before an interview, but if not, afterward."She said the
inquiry involving Mr. Easterly had not concluded, so it was unclear if he would
be disciplined.Several other people who work at the bank say its top officials
have recently taken a hard line on employees who violate guidelines for communicating
with the press.In one recent case, Robert Wade, a professor at the London School
of Economics who has served as a paid consultant to the bank, was cited for violating
disclosure policies when he wrote an opinion piece supportive of a bank lending
program in China that was canceled under pressure from outside critics."They are
going to be tough on anyone who says anything that has not already been vetted,"
Mr. Wade said. |
