http://www.moneyweb.co.za/mw/view/mw/en/page292681?oid=564029&sn=2009+Detail
Soapbox
Author: Barry D. Wood*|
12 March 2012 03:46*
Trevor Manuel on America's entitlement mentality
Why Trevor Manuel is not interested in being president of the World Bank.*
CAPE TOWN. When I asked National Planning Commission chief Trevor Manuel
whether he is interested in being president of the World Bank, he
replied that the short answer is no. He then spoke at length about the
challenges of the job. While rejecting American entitlement to a job it
has held without interruption for 65 years, he said there are benefits
from having a U.S. national as the chief executive who periodically
seeks money from congress for IDA, the Bank's interest-free lending
program for the poorest countries.
In remarks at his spacious office beneath Table Mountain, Manuel
suggested that for him the International Monetary Fund is the more vital
of the two Washington-based institutions at the center of global finance
and development. The immediate priority he said is the promised
rebalancing of voting shares within the I.M.F. where Europe and America
are disproportionately dominant. Last year Manuel's name was mooted for
the top I.M.F. job when Dominique Strauss-Kahn was unexpectedly and
quickly brought down by a sex scandal.
World Bank president Robert Zoellick announced last month that he would
not seek reappointment when his term expires on July 1. The resignation
triggered speculation that the American stranglehold on the job might at
last be broken. All 11 World Bank chief executives have been American
while under an archaic informal agreement the head of the I.M.F. has
always been European.
Manuel is hopeful that the BRICS grouping of emerging market countries
will put forward a candidate for the World Bank job by the March 23
deadline. There is no doubt that the bank is important. It is the
world's biggest multilateral lender and after China the biggest source
of development finance for Africa. "I certainly hope the BRICS will
nominate someone," he said, sounding more plaintive than resolute.
Rivalry between China and India is cited as a principal reason that the
BRICS (Brazil, Russia, India, China, South Africa) failed to agree on an
I.M.F. nominee last year. Asked whether an African or Latin American
nominee could emerge as a compromise, Manuel nodded and said both
Nigerian finance minister Nfgozi Okonjo Iweala and African Development
Bank chief executive Donald Kaberuka would be worthy successors to
Zoellick.
As the deadline looms, there is no indication that the American are
prepared to give up the World Bank job despite Washington agreeing in
September 2009 to a G 20 summit statement that future leaders of the
Bank and Fund must be selected through a merit-based, transparent
process open to candidates from all countries. Last year in the case of
the I.M.F; the Europeans prevailed in arguing that the euro currency
crisis and the Fund's central role in it made it essential that a
European again be chosen.
The Americans can make no such claim about the Bank. But despite that
State department spokeswoman Victoria Nuland said on February 24^th that
she expects "a strong American candidate, with full U.S. backing" to
soon be nominated. Three days later BRICS finance ministers meeting on
the margins of a Group of 20 meeting in Mexico again "rejected the
tradition that an American should automatically head the World Bank."
But there seems little chance that a non-American will get the job.
Manuel frames the issue this way, "what multi-national corporation" he
asks, "would specify that its top job could only go to a national of a
specific country?" Such practice, he says, would never be allowed. While
declining to openly criticize the Americans, Manuel recalls that when
Jim Wolfsensohn retired from the Bank, President George W. Bush merely
informed other national leaders that Paul Wolfowitz would be his
successor. Before his term expired Wolfowitz himself was forced out by
scandal and replaced by Zoellick.
While demurring from endorsing any candidate to succeed Zoellick, Manuel
did indicate that money manager Mohamad El-Erian, with joint Egyptian,
French and U.S. citizenship, has unique credentials. El-Erian was an
I.M.F. professional before becoming head of Harvard University's
endowment and now principal at global bond giant Pimco.
No matter the result, the contest for the World Bank job has evolved in
an unexpected way. Development economist Jeffrey Sachs is openly
campaigning for the job while the names of such luminaries as Bill
Gates, Hillary Clinton, Larry Summers, Tim Geithner, and Indo-American
Pepsico chief Indra Nooyi have all been mentioned.
A wry smile on his face, Trevor Manuel is observing the contest with
more than passing interest.
/* This article was prepared by Barry D. Wood. If you'd like to
contribute to Moneyweb's soapbox email [email protected]
/
/***
/
World Bank: Stiff competition for the presidential job
Washington <http://www.allvoices.com/Washington>: DC
<http://www.allvoices.com/United-States-Of-America/District-Of-Columbia>: USA
<http://www.allvoices.com/United-States-Of-America> | Mar 09, 2012 at
4:24 PM PST
Robert Zoellick <http://www.allvoices.com/people/Robert_Zoellick> the
present president is stepping down. Nominations for candidates to
replace the former managing director of Goldman Sachs must be made by
March 23.
Only Americans need apply for the job. By "tradition" an American is
always chosen as president. Nominations are made to the U.S.
administration in power at the time. See this article.
<http://en.wikipedia.org/wiki/World_Bank>
According to sources close to the Bank Obama was considering three
candidates Senator John Kerry, UN ambassador Susan Rice
<http://www.allvoices.com/people/Susan_Rice>, and economist Lawrence
Summers. However Kerry has said that he does not want the job.
Promoting himself from the sidelines is another economist Jeffrey Sachs
<http://www.allvoices.com/people/Jeffrey_Sachs>. Sachs has written
extensive and often caustic criticisms of the World Bank and the IMF. He
has the support of a number of developing countries.
As well he gets to promote his candidacy with several articles on Al
Jazeera. See for example his criticism of the World Bank here
<http://www.aljazeera.com/indepth/opinion/2012/02/201222575829192233.html>
In that article he calls for a new World Bank for a new world. In
particular he faults the bank for not considering what effect its
policies have on the poor. One can understand that countries who receive
loans from the bank would appreciate Sachs' point of view.
Another article in Al Jazeera by Michael Shank is virtually a
promotional ad for Sachs' candidacy. Shank says that Sachs is obviously
committed to doing everything in his power to eliminate poverty in his
lifetime. See the full article here
<http://www.aljazeera.com/indepth/opinion/2012/03/20123495258390513.html>.
So somehow or other the author of Shock Therapy in Bolivia, Poland, and
the former Soviet Union is forgotten.
Susan Rice has not indicated whether she wants the top job at the World
Bank. However some think that she may be more interested in becoming
Secretary of State as Hilary Clinton is rumoured to be thinking of
leaving the job later this year, In any event Rice is at present U.S.
ambassador to the UN. When asked as she walked to a UN Security Council
meeting if she were bound to the World Bank she scoffed: "C'mon, I've
got a great job,"
The World Bank wants to have its new president chosen by the time it
meets with the IMF on April 20-22nd. Zoellick will be stepping down when
his term ends on June 30.
Although an arrogant and in many ways reactionary economist Summers is
regarded as eminently qualified to serve as president of the World Bank.
He was Obama's director of the National Economic Council. He also served
as Treasury secretary under Bill Clinton. What more could you want? He
was at one time president of Harvard University and now an economics
professor there.
When he was World Bank chief economist he allegedly penned a memo
pointing out that in economic terms it would make sense economically to
ship toxic waste to undeveloped African countries. A discussion of the
memo can be foundhere. <http://en.wikipedia.org/wiki/Summers_memo> The
memo supposedly written by an underling and signed by Summers according
to the Wikipedia spin was said to be sarcastic and meant to be a
reductio ad absurdum of World Bank policies. Isn't it a bit odd that
Summers would show that the very policies he promoted were contradictory
and then go on to continue to promote those very same policies? This is
just a small sample of the problems with choosing Summers. At Harvard he
got into hot water with remarks about women and science and with Cornell
West about African studies. He also managed to help Harvard lose lots of
money: <http://en.wikipedia.org/wiki/Lawrence_Summers>
""During Summers's presidency at Harvard, the University entered into a
series totalling US$3.52 billion of interest rate swaps, financial
derivatives that can be used for either hedging or speculation.[44]
Summers approved the decision to enter into the swap contracts as
president of the university and as a member of Harvard Corp.,...] By
late 2008, those positions had lost approximately $1 billion in value, a
setback which forced Harvard to borrow significant sums in distressed
market conditions to meet margin calls on the swaps.[46] In the end
Harvard paid $497.6 million in termination fees to investment banks and
has agreed to pay another $425 million over 30-40 years.[45] ""
Obviously this guy is eminently qualified to head the World Bank as all
the responsible experts agree. Jeffrey Sachs is another matter but his
track record is also atrocious at some points in his career. He is one
of the key Harvard economists who helped Poland and Russia transform
into a market economy through Shock Therapy. Naomi Klein has a whole
book on the results of shock therapy. Many neoliberal economists still
defend it.
This article is already getting quite long. For a good summation of the
pros and cons of Sach's work see this article.
<http://www.leftbusinessobserver.com/Sachs.html> Certainly of late he
has made many trenchant criticisms of the World Bank and the IMF but
with his background and ego I remain suspicious. However, he would be
better than Summers for sure IMHO.
Sources:
http://en.wikipedia.org/wiki/Robert_Zoellick
http://en.wikipedia.org/wiki/Susan_Rice
http://www.aljazeera.com/indepth/opinion/2012/02/201222575829192233.html
http://en.wikipedia.org/wiki/World_Bank
http://www.leftbusinessobserver.com/Sachs.html
http://news.yahoo.com/kerry-summers-rice-world-bank-shortlist-source-063911638.html
northsunm32 is based in Brandon, Manitoba, Canada, and is an Anchor for
Allvoices.
***
Ngozi Okonjo-Iweala nominated for World Bank President
By The InfoStrides on March 6, 2012 | From theinfostrides.com
Nigeria's finance minister, Ngozi Okonjo-Iweala is among the candidates
being proposed to take over the presidency of the World Bank, with the
incumbent Robert Zoellick, having served notice that he would step down
in June.
Ngozi was a former managing director of the bank until late last year
when he resigned to become Nigeria's finance minister, for the second
time in less than a decade. She is the favorite of Nancy Birdsall, head
of the Center for Global Development, who stressed that the selection
process "needs to be competitive" and truly open to any candidate.
Birdsall has also proposed Nandan Nilekania, the Indian co-founder of
INFOSYS.
It is crucial that "whoever ends up in the job has the legitimacy that a
person that is truly competent would ensure," she said in a phone
interview with the AFP.
It is not clear yet whether Ngozi would dump Nigeria for the World bank job.
But the race is much hotter with Americans with renowned economist
Jeffrey Sachs, who led the UN committee on the Millennium development
goals, throwing his hat in the ring Friday in a Washington Post op-ed
piece, saying the World Bank needs an expert like himself rather than
another politician or Wall Street banker.
Sachs's declaration came amid signs the United States is eyeing others
for the high-profile job.
"The United States signaled that it was looking at the possibility of
nominating (Treasury Secretary Timothy) Geithner, (one of his
predecessors Larry) Summers, or someone from the private sector like
(Pimco chief executive) Mohamed El-Erian," said a person close to the
World Bank, who spoke on condition of anonymity.
Those three have remained mum on their interest in heading the global
development lender.
Secretary of State Hillary Clinton also has been widely mentioned in the
media as a possibilty. Geithner's deputy for international affairs, Lael
Brainard, has drawn some attention as well.
With the deadline for nominations three weeks away, the competition "is
beginning to pick up speed," the source said.
***
Obama advisor says why Larry Summers won't be the US nominee
<http://www.worldbankpresident.org/voice-of-reason/candidates/obama-advisor-says-why-larry-summers-wont-be-the-us-nominee>
Posted on March 10, 2012
<http://www.worldbankpresident.org/voice-of-reason/candidates/obama-advisor-says-why-larry-summers-wont-be-the-us-nominee>by
Voice of Reason <http://www.worldbankpresident.org/author/voice-of-reason>
2
<http://www.worldbankpresident.org/voice-of-reason/candidates/obama-advisor-says-why-larry-summers-wont-be-the-us-nominee#comments>
Valerie Jarrett, a senior White House advisor, made it clear in an
interview why it's just as well Larry Summers is happy as President
Emeritus at Harvard.
In this Daily Beast interview
<http://www.thedailybeast.com/articles/2012/03/09/jarrett-the-jobs-of-the-future-are-science-engineering-and-math-jobs-that-women-have-shied-away-from.html> Jarrett
used the occasion to hint how important women are to Obama's
re-election. He enjoys solid support and higher approval ratings than
his Republican challengers.
Jarrett was pretty clear: "The jobs of the future are science,
engineering and math, and those are the jobs that women have shied away
from," she said. The guarantee of a strong education for every child is
the magic bullet, and the administration is working toward that goal.
"If you have an education, then the sky is the limit," she said.
Teaching our daughters and colleagues confidence is crucial to the
formula for women's success."
Summers would, no doubt, agree on the future of good American jobs, and
how important it is for more women to be in these STEM fields. That's
not his reputation, alas, after his speech at Harvard before the faculty
removed him, and the White House isn't going to risk alienating a key
bloc of supporters in November.
Discuss among yourselves, journalists. If the reaction to the earlier
White House leak didn't take Summers out, this interview should make it
clear that Larry will be staying in Cambridge.
***
Criteria for choosing Zoellick's successor
<http://www.worldbankpresident.org/voice-of-reason/priorities/criteria-for-choosing-zoellicks-successor>
Posted on March 11, 2012
<http://www.worldbankpresident.org/voice-of-reason/priorities/criteria-for-choosing-zoellicks-successor>by
Voice of Reason <http://www.worldbankpresident.org/author/voice-of-reason>
<http://www.worldbankpresident.org/voice-of-reason/priorities/criteria-for-choosing-zoellicks-successor#respond>
After former World Bank Executive Director Moises Naim
<http://blogs.ft.com/the-a-list/2012/03/05/critical-tips-for-choosing-a-world-bank-head/#axzz1ooidFBbP> weighed
in with 'critical tips', thoughtful commentary in the FT by former World
Bank Vice Presidents, academics Ian Goldin
<http://www.ft.com/intl/cms/s/0/56555e28-6468-11e1-b50e-00144feabdc0.html#axzz1oksrDYh2> and
Danny Leipziger
<http://www.ft.com/intl/cms/s/0/36a7542a-67bd-11e1-b4a1-00144feabdc0.html>,
and a robust rejoinder to Goldin from former World Bank staff member
Percy Mistry highlight the issues the world should expect the World
Bank's owners and board to take into account as they prepare a shortlist
of three, interview candidates, and select "by consensus" Robert
Zoellick's successor.
Taken together, these contributions enrich the rather bland criteria set
out by the board in its announcement of what it will take into account.
What these four notes address is the Bank's *relevance* in the modern
world. All four hint, or say quite broadly, that there's a problem, and
that 'something needs to be done'.
They are right.
The Bank has long been overtaken by private capital flows as the main
source of finance for developing countries as a group. For Africa,
that's another matter, but for all the Bank's basking in the continent's
progress, it's fair to say that deregulation (yes, those dreadful,
awful, horrible Structural Adjustment Programs), democracy and
accountability, along with resources and an end to civil conflicts, have
led to remarkable--if somewhat unevenly distributed--private sector-led
growth.
Even on the official side of the balance sheet, the vertical funds
(e.g., GEF, the Global Fund, the Global Partnership for Education, and,
soon, the climate funds) transfer grant funds in quantities approaching
the net transfers by IDA. The arrival of China as a 'donor' to Africa
changes the game further in some countries, notably ones with resources
China wants and is prepared to invest in infrastructure--often
opaquely--to get its hands on. Naim put it well:
/The Bank is more than a bank. It is a consulting company for developing
countries, a multilateral organisation, an intensely political entity as
well as a highly technical one. Its role as an international lending
bank is declining relative to its advisory role./
Goldin points accurately to the Bank's inability so far, alas, to come
up with a narrative about the structural changes in the global economy
in which countries, rich and poor, will operate over the next 30 years.
Such a framework would anchor the Bank's work, including its financing
and its focus on which clients, on these important global issues, so
that whether by knowledge or by its convening authority, the Bank's
owners could set a new direction. Leipziger suggests this is a major
challenge, largely because of "neglect of long-simmering management
problems and singular lack of vision in its leadership." He goes on to
say, "The Bank is losing its way because it has lost its edge,"
attributing this to a series of ill-conceived and badly executed changes
in how the Bank manages itself and recruits, selects, retains and
promotes its staff.
It is little wonder, then, that think tanks, government research units
and universities now challenge the Bank for intellectual clout with
practical impact. One need only think of McKinsey's iconic graphic
about the effectiveness of energy investments and technology for
addressing climate change as a key example of applied research that
provokes new thinking and new conversations. Or how the Bank told
Brazil that conditional cash transfers would never work, and then
proudly 'facilitated' the contact between New York City and Brazil on
/Bolsa Familia/. Or perhaps how the Bank arrived late to the game on
randomized, double-blind evaluation methods, catching up only later with
Esther Duflo and her colleagues at MIT's Poverty Action Lab.
Leipziger summarizes this HR situation
/"Its support for leading-edge work in sectors where countries need
advice has evaporated and is not being rebuilt. These trends, long in
the making, have been exacerbated in the last five years [under Robert
Zoellick's presidency.]"/
Between a costly and poorly implemented decentralization program, and
Bank management's supine acquiescence to board demands for a "flat real
budget", the money to rebuild the Bank's intellectual capacity just
isn't there. The Bank has turned to armies of junior interns,
consultants and early retirees to meet this need, with new recruits
given term contracts--generally two years even though five is supposed
to be the norm. This had led, in turn, to even greater risk aversion by
managers about hiring and by new hires about stepping too far from the
Bank's accepted wisdom.
Leipziger puts well what the new president's priorities should be:
/The first step is to restore a sense of purpose to the institution
around a longer-term vision. Being tactically involved in a series of
global events is no substitute for a visionary strategy. Second, serious
internal reform efforts are long overdue; the Bank has done little of
what it preaches to its clients. Third, and most important, the
leadership of the Bank requires passion, a deep sense of commitment to
solving the pressing issues of development. /
This not-so-oblique criticism on "development by international meetings
with new initiatives at each" and a Chinese preference for stability at
all costs after Paul Wolfowitz's disastrous two years is neatly
summarized by the plea for setting priorities on "solving the pressing
issues of development". While Jim Wolfensohn was responsible for
launching the Bank's sprawling partnership business (which still needs
some serious tidying and pruning), in his era the partnerships were to
build friends after a fractious history with CSOs and global causes.
Recently it's become more about having followers, like on Facebook or
Twitter, or doing favors for your friends or cultivating future
employers, with little depth and few goals shared through concrete work
together.
Goldin and Leipziger also agree on the underlying causes. While Goldin
(presumably in a trial balloon for his own candidacy given his South
African passport and career in academia as well as a stint at the Bank)
put it
/The response of many countries has been to load new mandates on to the
Bank, as they consider it to be a more capable and compliant partner
than the UN or other agencies. However, without the legitimacy, capacity
or executive power to manage the widening range of global public goods,
this mission creep is doomed to failure. /
From this bleak assessment of what the new World Bank president must
do, the Bank's owners have to find someone who will
* set a clear direction and lead toward it
* review and change the Bank's internal policies that get in the way
of getting there (HR and the budget, to start, and perhaps a cold,
hard look at whether decentralization makes sense)
* engage the owners and the Bank's board on their role in this
situation, and how they will restructure to let the Bank's
management lead and hold them accountable for doing so
It really doesn't matter much the nationality of the candidate. A
process--any process--that gets the right person who will be responsible
for turning the Bank around will be merit-based. Why the Bank should be
held to an 'open and transparent' standard that no other international
organization or corporation follows is a question we should all be
asking in the run-up to the nomination and the month-long process to the
announcement during the Spring Meetings. Getting the right woman or man
is too important to get wrong.
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