Wednesday, March 16, 2005

Wolfowitz to World Bank

The Associated Press reports that the president has chosen Paul Wolfowitz, Deputy Secretary of Defense, to head the World Bank when World Bank President James Wolfensohn steps down. Link.
The United States is the World Bank's largest shareholder in the development bank. The bank traditionally has had an American president. Its sister institution, the International Monetary Fund, traditionally has been headed by a European.

Bush noted that he had called Premier Silvio Berlusconi to talk about Iraq and other issues earlier in the day and said that he had discussed Wolfowitz, "my nominee," with the Italian leader. (...)

A conservative scholar and veteran of six administrations, Wolfowitz earned a reputation for being a foreign policy hawk — representing the view that the United States should use its superpower status to push for reforms in other nations.

The problems at the World Bank, which has a history of throwing vast quantities of money at socialist dictators that waste or steal it with no benefit to their citizens, is philosophical not administrative. The Bank needs to focus on poor countries that are moving toward free markets, and preferably toward free political systems as well. Such countries are far more likely to spend the money in ways that develop their economies and help their people. Hong Kong, South Korea and Japan, among others, have barely any natural resources and were very poor when they adopted freer market economies and freer legal systems. Any country can become reasonably wealthy if it follows their examples.

Wolfowitz's strong suit is his extremely strong commitment to democracy everywhere. In my opinion, that makes him ideal for the top spot at the World Bank. When countries whose people were starving got the most from the World Bank, their leaders made sure the people starved. If they start to see that they will get the most by moving their economic policies toward free markets, the incentive will be there for them to do that. Their people will be the beneficiaries.


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