A New Era of Accountability?

car

March 31, 2005

President George Bush's recent appointment of Paul Wolfowitz to head the World Bank has stirred up a significant amount of conversation on the future of the organization. It is no doubt drawing gasps from the left that a man whom they perceive as an evil neo-conservative, bent on world domination, could be selected to head an organization that seeks to assist economic development in third world countries. After all, how can such a clearly philanthropic end be achieved by the likes of a hawk whom they think would prefer to kill innocent Iraqis and sacrifice Americans, just for cheap oil?

The appointment also rekindles the interest in the nomination of John Bolton as ambassador to the United Nations. Surely, some leftists must be in the throes of panic, in light of these two bold appointments by President Bush. Amity Schlaes of the Financial Times keenly noticed the coincidence of these two nominations and asks the question that leftists are likely asking themselves: "Is Bush trying to destroy the UN and World Bank?" She points out that the "multilateralists" as she refers those who may ask such a question, "ought to be thrilled about these choices. These men are not going to endanger the future of the UN or the World Bank. Those futures are already in danger.” That point cannot be made often enough. The existence of the United Nations and World Bank are imperiled by their irrelevancy, ineffectiveness, and inefficiency, which remove any incentive for donor nations such as the United States to continue making contributions that keep those organizations afloat.

The United Nations - Irrelevant and Inefficacious

The irrelevancy of the UN is hardly debatable, given that its role in the lead up to war in Operation Iraqi Freedom amounted to little more than providing chairs for the rest of the world's dignitaries to sit in, as they gathered to passively witness the US, Great Britain, Australia and Spain deciding when they would enforce the otherwise irrelevant UN resolutions pertaining to Iraq. The recent controversy surrounding Kofi Annan, the debacle of UN peacekeepers raping refugees in Africa, the lack of any meaningful response to tribal wars in Rwanda and Sudan, the uselessness of the UN in Somalia, the failure of UN Peacekeepers to ward off continued genocide in Bosnia-Herzegovina, and the retreat from Iraq in 2003 are damning testimony against the relevancy and efficacy of the United Nations.

The United Nations is clearly in need of some candid self-examination and John Bolton is a great choice to be a catalyst for this. He will assume a leadership role by virtue of being the ambassador for the world's only acting superpower. As America charges forward with the liberation of the Arab world and spread of democracy, the rest of the civilized world wrestles with the moral dilemma of whether to put a stop to genocide in Africa. In a climate where US hegemony contrasts so starkly with the endless debate and shuffling of feet amongst the rest of the civilized world, any US Ambassador to the UN will naturally be the man who sets the tone and the agenda for the United Nations, especially with a Secretary-General weakened by scandal. John Bolton has spent a fair amount of time reflecting on the relevancy and efficacy of the United Nations, so it is with good reason that he is an outspoken critic. Now is his chance to do something about it.

The World Bank - A New Era of Accountability?

Five years ago, Allan Meltzer wrote the following about the World Bank in an American Enterprise Institute "On the Issues" paper:

"The World Bank is an overstaffed, ineffective, bureaucratic institution. Including its subsidiaries, it has about twelve thousand employees, mostly dedicated professionals who are committed to development and poverty relief. Yet the Bank's record is fairly poor. By its own admission, half its projects are unsuccessful, and the failure rate is even higher in the poorest countries."

This may be a harsh assessment due to the clientele of the World Bank. But, the fact remains that the World Bank has failed to adequately attach conditions to its loans for meaningful change. Max Borders writes in his recent article "Wolfie at the Bank":

"One of the biggest problems with the World Bank is that it has not been tough enough about demands on borrowing nations for institutional change. Nobel-caliber economists such as Doug North have finally gotten the term 'institutions' into the bureaucratic nomenclature, but the concept has been distilled into weak calls for 'good governance' by both the World Bank and IMF. Such governance lip-service has done little to solve the problems of corruption and systemic malaise that plague the developing world. Paul Wolfowitz might just be the man to say 'if you don't change, we cut you off.' It's time somebody said that."

Paul Wolfowitz' performance in the Department of Defense, in particular, is good reason to believe in his ability and willingness to turn the World Bank around and make it an effective vehicle for change in the developing world. As Deputy Secretary of Defense, he was among the most ardent and forceful advocates of using military force in Iraq, a policy battle that he had been waging for more than ten years, beginning when he was the number three man in the department. Although he won few friends across the aisle, he helped to make a controversial, unpopular, but necessary regime change occur. There is little reason to believe that he will make any friends among his potential and future clientele, as head of the World Bank, but then again his job is not to be liked. His job is to effect meaningful change in corrupt third world nations, so that their people may prosper from foreign investment. Borders went on to clarify just what needs to be changed:

"... too much of the vast resources poured into the Third World end up in the coffers of dictators, cronies and lackeys. And the money that does trickle through to the people ends up as some expensive, misguided 'infrastructure' project, or creates dependency relationships on people trapped at subsistence.”

Paul Wolfowitz can, should, and is expected to inject some accountability into a World Bank that currently lacks any whatsoever.

Can Two of the World's Greatest Failures Become the Primary Vehicles for Peace and Economic Prosperity?

The United Nations and the World Bank were borne of good will and noble aims. But, they are both abject failures, thus far. The nominations of John Bolton and Paul Wolfowitz are a long time in coming. Strong leaders, determined to shatter the status quo, are needed in both institutions. With a United States President committed to back them up, Bolton and Wolfowitz have the opportunity to become two of the most influential and positive agents for change in a generation. The United Nations has been exposed as a farce and is grudgingly coming to the realization that it must change. The World Bank, long the puppet of bureaucrats and crooked third-world politicians, is about to inherit a leader who understands the past mismanagement and inefficiency of the organization, which will necessitate its change. If these two leaders are able to turn around their respective institutions, then those international bodies will enjoy greater legitimacy and the developing world will be given new hope for a brighter future.

A United Nations focused on its stated purpose of securing peace can set the conditions for the World Bank to secure economic prosperity for the developing world. The key to economic prosperity in any nation is a secure society with a stable government that is conducive to free trade. If the United Nations can abandon its distracting agendas of anti-Semitism, environmentalism, and grafting and focus on promoting peace, then the World Bank will be in a better position to assist in the economic development of emerging economies. Peace and economic prosperity create stability and enhance the security situation in developing countries. In this way, the United Nations and World Bank can enjoy a symbiotic relationship as they work towards the noble and idealistic goals on which they were founded.

- TJM

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