Date published: 2005/09/24
The Financial Times has a lengthy article about Paul Wolfowitz (subscription service) in this weekend's edition. It's mainly a flattering portrait, with a few interesting paragraphs:
The promotion of democracy has been one of the most consistent themes of his career. As a leading neoconservative, he believes in the use of US might to advance democracy abroad. Because of this, and his role in the Iraq war and its troubled aftermath, it is no secret that a large chunk of the bank's staff was appalled when he got the job last June. (There was a similar reaction in some European finance and development ministries, but national leaders gave their backing and Wolfowitz was approved by unanimous vote at the bank's board.)
There is an obvious comparison between Wolfowitz and Robert McNamara, the controversial Vietnam war defense secretary who resigned from the Pentagon to head the World Bank. But when I asked Wolfowitz about the comparison, he said: "I don”t know if it is fair to put that label on him - but I certainly was not running away from my old job. I would have stayed there very happily if this hadn't come along as, you know, a more exciting opportunity."
As for Iraq, he said: "I don't want to get into an argument with all the people around here who might have a different view, but I still think that what the US, UK and others did for Iraq was the right thing and done for the right reasons. And hopefully it”s going to turn out the right way." He added that wherever he had travelled recently, from Burkina Faso to Bosnia, Iraq had hardly come up at all.
Of course the (illegal) invasion of Iraq was done for the wrong reasons (it was a party political exercise to promote the Republican Party as patriotic and the Democratic Party as not). But that's not the fault of Wolfowitz. And as he said, what he's going to do with the World Bank is more important now (for him personally) than what happened in Iraq (no matter how much that has damaged American credibility).
But what exactly are his priorities? After more than half a dozen conversations with Wolfowitz, and more with others close to him, it seems clear the new president will make sure that the bank”s main concern will remain Africa, the first continent he visited after his appointment.
Sub-Saharan Africa is unquestionably where the bank's work is most needed. Numerically, there are more people living in abject poverty in China and India, but unlike Africa those countries have fast-growing economies, functioning states and a 20-year record on reducing poverty. Fears that the neocon hawk might try to reorientate the bank towards promoting democracy in the Middle East, and away from fighting poverty in Africa, are far-fetched.
Wolfowitz would like his legacy at the bank to be the moment when Africa shifted on to a sustainable development path, which is no small ambition. "I am not naive. It”s a huge challenge and the bank is only a small part of the answer, but if the world and the sub-continent can rise to that challenge, it would be wonderful to feel that we made a difference," he says.
Wolfowitz sees an important role for aid, but is very sceptical of the idea that the only path to successful development is for rich countries to give poor ones enough money. Pointing to south-east Asia and China, which did not rely on financial aid, he says it is a "fallacy" to think spending money is all that is needed to reach targets such as the eight "Millennium Development Goals" that commit the international community to address a range of development challenges by 2015, from extreme poverty to access to education. Money, he says, "is a necessary but far from sufficient condition".
As for what he calls "the development process", he says "my feeling is that we understand about half of it, and about half of it is a mystery, almost". He thinks it is affected by much more than strictly economic factors. "Leadership is a huge factor, both good and bad leadership, and one of the things that seems to be changing in Africa is that the ratio of good leaders to bad leaders seems to be going up significantly."
One area in which Wolfowitz may differ from his predecessor is the central importance of economic growth in reducing poverty. James Wolfensohn was sometimes criticised for being too willing to please non-government organisations - and some within the bank - who opposed making growth the top priority. Wolfowitz has been clear from the start: "It's just an inescapable fact you can't make serious dents in poverty without sustained growth over a considerable period of time."
The bank's new action plan for Africa is laden with references to private sector-led growth in areas such as agriculture and regional trade. A recent report by the bank's Operations Evaluation Department, an independent unit that analyses its loans and grants, said the organisation needed to refocus on promoting growth and investing in infrastructure. Spending more on health and education projects alone, for example, would not by itself reduce poverty. Wolfowitz appears to agree with the broad thrust of that report. During most of Wolfensohn's time at the bank, there was a shift away from large-scale infrastructure projects, though at the demand of borrowing countries there had been a greater focus in the last couple of years. Wolfowitz aims to take this much further. He is committed to increasing the bank's investment in hydropower, roads, water and telecommunications and while he says the bank must learn from mistakes of the past, he adds that it won't cave in to protests from environmental and social activists.
It almost sounds too sensible to be true. And time will tell. Unfortunately when you have a bunch of rich people playing god (the World Bank, the NGOs, etc.) the outcome is usually less than perfect. But at least Wolfowitz seems to be on the right track.
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