Opinion

Felix Salmon

Is the World Bank board sure what Jim Kim thinks?

Felix Salmon
Apr 13, 2012 19:22 UTC

William Easterly is uncharacteristically credulous today. He spoke to one of those Senior Administration Officials on Wednesday, and the Official gave Easterly the official explanation for why Jim Yong Kim has failed to RSVP for the CGD/Washington Post forum or for any other public appearance.

The official said it was purely logistical: Kim has been constantly on the road meeting member governments, and would continue to be on the road right up until the vote.

Moreover, Kim’s nomination happened at the last possible moment, and the nominations of Okonjo-Iweala and Ocampo were also late. The official said this was a global appointment and not a Washington one, so member governments have a higher claim on Kim’s very limited time than development experts.

I confess this argument (almost) convinces me.

Easterly goes on to say that because there needs to be some kind of public debate about Kim’s views on development, the World Bank’s board should delay its choice in the matter until after that debate has happened.

That’s not going to happen: by all accounts we’re well into the end of the process already. The board has interviewed all three candidates, and today is taking a straw poll — a process designed to build consensus (if you’re being charitable) or make it obvious that no non-U.S. candidate has any chance of winning (if you’re not). Jose Antonio Ocampo has officially withdrawn his candidacy in favor of Ngozi Okonjo-Iweala; it’s a noble move, but it’s unlikely to have much practical effect. By Monday, barring some divine intervention, Kim will have been officially awarded the job, in a process characterized by extreme opacity — especially now that a key BRIC nation, Russia, is officially supporting Kim.

I do appreciate that Kim’s constituency, both now and for however long he holds his new job, is the Bank’s shareholders, rather than the broader public. And so, like any good politician, he’s concentrating on buttering up his constituents.

But when most politicians butter up their constituents, they do so in public, and the news media is there to report on what they’re saying. Kim’s meetings, in contrast, have all taken place behind closed doors.

Daniel Altman thinks it’s a “canard” that the next president of the Bank should be asked to make his case to the public, on the grounds that hey, the Bank doesn’t actually cost taxpayers that much. But this isn’t about money, it’s about transparency. And specifically, if all of Kim’s meetings are being held behind closed doors, no one knows what horses are being traded, what the countries with the most votes are asking of Kim, and what he’s promising them in return for their vote.

If a candidate appears in public and says quite clearly what his vision for the bank is and what he intends to do about certain matters, then at least there’s something to hold him to once he’s in office. Kim, by contrast, has said essentially nothing about what he wants to do at the Bank; everybody supporting him is essentially projecting their own hopes for what they would like him to do.

And so while I wouldn’t go so far as Michael Clemens, who suggests that Kim’s nomination could be a violation of the Bank’s articles of agreement, if I were on the board I’d be a bit worried about what Kim had told all the other countries while he was on his “listening tour”, and I’d welcome a public position statement from him just to make sure that he’s saying the same thing to everybody.

COMMENT

The choice of Kim is a good one for the reason that he is a practitioner of development. Anyone who has followed the Bank’s failed policies especially in Africa – SAP’s, Education, etc will tell you that the theorists can’t to the job. Okonjo is not a success by any measure when it comes to seeking such a top job. If is a fantasy or is it a fairy tale, that a Nigerian would seek such a job. Her career in Nigeria did not turn that nation around. Being from a country or continent in which they cannot manage their money, seek debt forgiveness yet come for more and do not ever show signs of improved governance of their monetary and corruption ridden structures raises an eyebrow. Asia is the direction of the next few years and Kim is well placed to take that on. It matters that you are from a country that is not known as the corrupt Mecca of the world.

Posted by JennyLJones | Report as abusive

Why Jim Yong Kim won’t change the World Bank

Felix Salmon
Apr 9, 2012 12:31 UTC

Thomas Bollyky has a subtle and slightly confusing op-ed in the NYT today, entitled “How to Fix the World Bank”. Worldbankpresident.org, your one-stop shop for all news on the race, calls it “an important endorsement for Jim Kim, and for change at the World Bank”. But while it’s the latter — Bollyky’s case for change is strong and compelling — it’s by no means the former. Indeed, Kim in many ways represents the status quo ante, and a vote against change at the Bank.

The heart of Bollyky’s argument is the undeniable case that since the world has changed, the Bank needs to change too.

An election based on American citizenship, as opposed to a vision for institutional leadership, limits the support from shareholders that the president of the World Bank needs to enact bold reforms.

As a result, the World Bank remains largely stuck in an operational model of providing country-specific loans and grants that are increasingly irrelevant to its institutional mission of reducing global poverty…

The pressing challenges in international development have changed. While fewer countries are very poor, many of their citizens remain so. The number of people living on less than $2 per day has declined as a share of the world’s population but has stayed around 2.5 billion since 1981. Income disparities have increased. More than two-thirds of the world’s poorest people now live in middle-income countries, where health care, education and environmental regulations lag far behind economic growth. Persistent poverty, when combined with limited governance and unprecedented rates of urbanization, has produced huge slums, which now house nearly one billion people in developing countries. Many of the emerging threats to global prosperity are collective problems that no government alone can solve: climate change, water shortages, inadequate agricultural productivity.

The World Bank is designed along simplistic lines, even if the problems it faces are anything but. The world’s poor live in poor countries, is the implied syllogism, so we should lend those countries money to help them develop and become richer. If we solve the problem of poor countries, we’ll solve the problem of poverty.

This approach became outdated somewhere around the millennium. In 1990, 93% of the world’s poor lived in low-income countries. By 2007, three-quarters of the world’s poor lived in middle-income countries. So if the World Bank is still focused on lending money to low-income countries, it’s by definition missing most of the world’s poor.

Bollyky says that Kim’s inexperience in government will be damning “only if he is forced to lead an institution largely devoted to providing the country-by-country loans and grants that fewer and fewer governments need.” But that is the US vision of the World Bank. Moreover, precisely because he’s unfamiliar with World Bank bureaucracy, Kim is the least qualified candidate if you want someone who is going to radically revamp the way the Bank works.

If you want to understand what the Obama administration thinks the job of the World Bank is, all you need to do is read Barack Obama’s own remarks when he nominated Jim Kim to lead the institution. First, he said that Bob Zoellick “has been a strong and effective leader at the bank for the last five years” — which gives you an idea of what the US considers “strong and effective” in this context. Then, we got this:

The World Bank is more than just a bank. It’s one of the most powerful tools we have to reduce poverty and raise standards of living in some of the poorest countries on the planet…

Ultimately, when a nation goes from poverty to prosperity, it makes the world stronger and more secure for everybody.

Obama here is talking very explicitly in the old language, where the Bank targets the poorest countries on the planet, and tries to help them from poverty to prosperity. That’s sad, because if you look at the the history of the World Bank, it has been quite bad at shepherding countries from poverty to prosperity: it’s been most active in countries where that hasn’t happened, and meanwhile the countries which have managed the change have done so largely on their own, without much in the way of World Bank assistance.

As Bollyky says, what the Bank should do is revamp its architecture so that it can target poverty wherever it is found around the world, rather than working mainly in the world’s poorest countries. And at the same time, it must play a coordinating role in addressing cross-border issues, especially in a world where one country’s necessary crop irrigation looks to its neighbor very much like the theft of precious water.

But the World Bank won’t move far in that direction so long as its president is imposed by fiat of the US. In order to work effectively at the sub-national and international level, the World Bank needs to be a genuinely international organization, run by and for the whole world, rather than being viewed as a means for the US to project “soft power” in Africa and elsewhere. For that reason alone the president of the World Bank should not be a US citizen, and in fact it would probably be helpful if the US didn’t put forward an official nominee at all. After all, as Bollyky notes, the US already has a veto over the Bank’s presidency: that should be more than enough.

More to the point, if the president of the World Bank is going to come in with a mandate to fundamentally change the way that the organization works, then that person really has to be very clear about what they want to achieve before the decision to appoint them is made. Both Okonjo-Iweala and Ocampo are happy to answer detailed questions, in public, about their vision for the Bank; Kim isn’t. And he can’t be vague now if he wants to be decisive once in office.

Bollyky concludes by saying, quite rightly, that “Kim needs to be candid and specific with shareholders and the public about his agenda for revitalizing the World Bank”. Another way of putting that is to say that if Kim is not candid and specific with shareholders and the public about his agenda, then he should not become president of the organization. The time for “listening tours” is over. He needs to start talking, now. Because you can’t have a mandate if the electorate has no idea what it’s voting for.

COMMENT

@PerKurowski – Are you familiar with this Anglo-Saxon turn of phrase –

“He who pays the piper gets to call the tune.”

The biggest chunk of WB money comes to it from the pockets of US taxpayers. Whatever they want is, by definition, the right thing to do, isn’t it?

Posted by MrRFox | Report as abusive

Jim Yong Kim’s depressing tactical silence

Felix Salmon
Apr 5, 2012 16:37 UTC

When Barack Obama nominated Jim Yong Kim to be the president of the World Bank, the most notable thing that he said was about Trayvon Martin. And since then, Kim has disappeared. Jesse Griffiths put up a post on Sunday starting a Kim-watch, but so far nothing; it’s increasingly obvious that he’s not going to turn up, for instance, for the CGD/World Bank Q&A sessions next week. (They’re being webcast; Okonjo-Iweala is up at 3pm on Monday, while Ocampo is scheduled for 4pm on Tuesday.)

(*Update: Kim has actually given a handful of on-the-record interviews, which make it very clear that giving on-the-record interviews is not a great way for him to get the job. Indeed, the most striking thing about them is his propensity to flat-out lie. “I am very proud to be part of what is the first contested, merit based, open election ever for presidency of the World Bank,” he told Capital Ethiopia. “I am proud of being part of the first transparent, merit-based election in the World Bank history,” he said to the Hindustan Times. “I’m coming into this election and not asking people to support me because I’m an American,” he told Nikkei. “I ask people to support me because of my experience.” But of course it goes without saying that this election is not transparent, and is not merit-based. If it were merit-based, the Canadians and the Japanese would probably have met with Okonjo-Iweala and Ocampo before declaring their support for Kim. It’s bad enough that Kim is being installed in the presidency of the World Bank by the divine right of POTUS. But it’s much worse that he thinks that if he wins, he’s going to have done so fair and square.)

Kim is unlikely to make a public appearance at the UN, where both Okonjo-Iweala and Ocampo are due to moderate panels on Wednesday on the subject of whether financial speculation is raising global food prices. (Interestingly, one of the panelists in Ocampo’s session is Jeff Sachs, who was himself nominated for the job of World Bank president.)

This makes perfect narrow tactical sense, if Kim’s sole aim right now is to clinch the presidency at any cost. He has already quietly received the official support of both Canada and Japan; all he needs now is to make no waves, sew up the European vote, and report for work in a couple of months. Engaging in any kind of public statement or debate has only downside and no upside for him, especially as the first question he’d get would surely be whether or not he thinks that the selection process should be an open one designed to choose the best candidate for the job.

But does Treasury really want to impose its candidate in such a heavy-handed manner? Joe Stiglitz is absolutely right that America’s best interests might not in fact be served by having an American in charge:

Should America continue to insist on controlling the selection process, it is the Bank itself that would suffer. For years, the Bank’s effectiveness was compromised because it was seen, in part, as a tool of Western governments and their countries’ financial and corporate sectors. Ironically, even America’s long-term interests would be best served by a commitment – not just in words, but also in deeds – to a merit-based system and good governance.

This is pretty much the unanimous view within the World Bank itself, where the new president is going to have to have significant support from the rank and file if any substantive changes are ever going to happen.

No heavyweights have come out and said that Kim is better qualified than either Okonjo-Iweala or Ocampo; certainly Kim has nothing like the intellectual weight of the petition in favor of Ocampo behind him.

It seems to me, then, that the US government in general, and the Geithner-Clinton axis in particular, doesn’t actually want any real change at the World Bank. Change can only come from a strong president who is strongly supported by the US, which has veto power over any real changes. Kim will be a weak president. If Treasury wanted change at the Bank, then the US should have thrown its weight behind Okonjo-Iweala, who has the bureaucratic chops to make it happen. Or, if it wanted to keep the presidency in the Americas, it could have nominated someone like Michele Bachelet or even Paul Martin.

Instead, the Obama administration opted to nominate someone with a narrow health focus, who as far as anybody can tell has no big vision for the Bank at all, and whose ability to steer this particular supertanker is almost certainly going to be very limited. The World Bank, under Kim, will decline in relevance, as the new creditor nations, especially Brazil and China, demonstrate understandable reluctance to fund an organization in which they have distressingly little voice.

Barack Obama, here, had the opportunity to nominate a Bank president who comes from a recipient of World Bank funds, rather than a representative of the lenders. That would have been a truly revolutionary and welcome move. Instead, he opted for a continuation of the status quo. Which means that once Kim gets the job, he’ll basically be restricted to tinkering around the edges.

The World Bank can and should be a force for effective change and poverty reduction around the world. But the US nominee is clearly much more interested in simply filling the position than he is in laying out a vision for what he thinks the Bank should do, or engaging in any public debate at all about whether he should get the job that he’s applying for. And if he doesn’t want to be open about such things, it’s very hard to see why the world should give him the benefit of the doubt. Here’s hoping that the Bank’s board grows itself a backbone and chooses the best candidate, rather than the one they’re being strong-armed into simply accepting.

COMMENT

Felix, like the others I very much enjoy your writing and regularly read your blog. However, I find your dogmatic attachment to this issue puzzling — to the point that it makes me question your motives. As Chris08 stated, it *really* doesn’t become you.

Posted by EcoNYC | Report as abusive

Does anybody at all think Kim’s a better candidate than Ngozi?

Felix Salmon
Apr 3, 2012 22:28 UTC

If you want to get a great feel for the difference between Jim Yong Kim and Ngozi Okonjo-Iweala, just check out what they’ve said in public about what they want to do with the presidency of the World Bank.

Here’s Kim:

We live in a time of historic opportunity… We can imagine a world in which billions of people in developing countries enjoy increases in their incomes and living standards… My own life and work have led me to believe that inclusive development – investing in human beings – is an economic and moral imperative… economic growth is vital to generate resources… for change to happen, we need partnerships between governments, the private sector and civil society to build systems that can deliver sustainable, scalable solutions… we must draw on ideas and experience from around the globe… A more responsive World Bank must meet the challenges of the moment but also foresee those of the future. The World Bank serves all countries… I will ensure that the World Bank provides a platform for the exchange of ideas.

And here’s just one of Ngozi’s answers, in a Q&A with Annie Lowrey:

We need to move faster. The bank has to be quick, nimble and responsive in this global environment. I would like it to be much faster to get aid on the ground, and faster giving policy advice and help to ministers looking for it. I’d look to do things in days and weeks rather than months and years, and I have the bureaucratic knowledge, the knowledge of the institution, to make that happen.

But the premier goal should be helping developing countries with the problem of job creation. In country after country, the single most important challenge is how to create good jobs – in developing countries as well as developed countries. And a big challenge is youth unemployment, which I want to tackle very fast because of the other problems it creates.

There is an opportunity for a demographic dividend for developing countries if they address this issue. In my country, about 70 percent of the citizens are 30 years old or younger, and there are similar demographics in many other developing countries. The rest of the developed world is looking at a gerontocracy, but we’re looking at a youth bulge.

The World Bank is the premier institution to support young people, with all of its instruments to create jobs, build infrastructure and invest in human infrastructure. Also, green growth and climate change – that’s another issue I see as an opportunity for investment. And the World Bank has the knowledge and financial resources to help.

Okonjo-Iweala knows what the Bank was set up to do, knows what it’s capable of, and has a real vision for how it billions can be used to create growth and prosperity around the world and specifically in Africa. Here’s how Jagdish Bhagwati puts it:

The Obama administration mistakenly believes that “development” consists of healthcare, microfinance and other such projects, and not the big high-pay-off “macro-level” policies such as trade. The insidious notion that the former constitutes “development economics” and the latter does not is both wrong and glorifies the less important at the expense of the more important…

Dr Okonjo-Iweala will do both “macro” and “micro” projects. But Dr Kim’s healthcare expertise comes with an uncritical embrace of the charges against “neoliberalism”, betraying susceptibility to the anti-reform, anti-growth rhetoric of the 1990s.

The fact is that Kim, if you take his FT op-ed at face value, seems to be utterly clueless, and mostly interested in distancing himself from the opinions in his book (which was blurbed by Noam Chomsky) on inequality and health. There’s certainly no indication that he understands exactly what it is that the Bank is uniquely capable of achieving.

What’s more, Kim seems to have no appetite for a contest. Okonjo-Iweala is perfectly willing to say, quite explicitly, why she’s a better candidate than Kim. She’s not a narrow expert on health, as Kim is; she’s expert in many subject areas, from education to agriculture to manufacturing, and also the differences between the world’s developing regions. And her experience as Nigeria’s economy minister is surely much more germane than Kim’s as president of Dartmouth College.

Meanwhile, I’ve done quite a lot of searching, and asked Treasury to help me out, and so far I’ve managed to come up with exactly zero endorsements of Kim which explicitly say that he’s a better candidate than Ngozi. Even Kim himself hasn’t said, as far as I can tell, that he’s a better candidate than Ngozi. And he has notably failed to RSVP to the Center for Global Development and the Washington Post, which are running public sessions where the candidates can explain their vision for the bank’s future and be questioned by the media and members of the international development community.

Yes, it’s true that Okonjo-Iweala is in many ways the “establishment choice” for the job. But that’s no reason not to give it to her — quite the opposite. When you’re talking about a massive bureaucracy like the World Bank, only an establishmentarian has a chance of being able to steer it, rather than simply being steered by it or completely marginalized.

Conventional wisdom has it that the NYT has endorsed Kim; it hasn’t. The editorial is here; while it says nice things about Kim, it concludes by saying that the best outcome for the bank would be a “truly competitive and fully transparent” process for choosing the next president — and everybody knows that in such a process, Okonjo-Iweala would win. Similarly, Todd Moss, in an op-ed headlined “Why Obama Should Keep Control of the World Bank”, says quite explicitly that Okonjo-Iweala is “the candidate most qualified for the job”; the main reason for choosing Kim instead is that he will have “access to the corridors of American power”.

Does Moss explain why he thinks that Kim will have more access to the corridors of American power than Okonjo-Iweala? Not as far as I can tell. And as an Ngozi observer of many years’ standing, I’m quite confident in saying that should she become president of the World Bank, she will have a surprisingly large degree of access to the White House.

It seems to me that it’s incumbent on the White House to at the very least attempt to explain why Kim would be better in the job than Okonjo-Iweala. If they can’t or won’t do that, then they should forfeit their anachronistic droit du seigneur, at least this time around when the alternative is so strong. Ngozi Okonjo-Iweala is the best candidate for the job, and Barack Obama knows it. He should meet with her, and then do the right thing by freeing up the Bank’s board to vote for whomever they think most qualified.

COMMENT

Let me play a single point as mentioned, why hasn’t Jim Kim replied to the CGD/WPost interview-audience discussion? Instead, he, with the support of State and Treasury, is touring the world, asking for support. Sounds like the old agenda doesn’t it?

Nogzi has failures. It may apply that she’s also a neoliberal–she stated that she hates that word. Well, Obama is also a neoliberal.

The point is, do you want transparent global economic governance institution or the same old game? And if you want the same old game, why hasn’t your candidate at least talked?

Posted by Jeneral28 | Report as abusive

The political calculus of the World Bank contest

Felix Salmon
Apr 2, 2012 17:24 UTC

Mohamed El-Erian comes out in favor of Ngozi Okonjo-Iweala today, while at the same time explaining the fraught international political calculus involved in working out who is going to vote for whom.

Here’s how it works: Europe is looking to the IMF to beef up the amount of money that it’s going to make available to the continent. In order for that to happen, the US is going to have to support the increase in IMF funding. And so the outlines of a quid pro quo begin to emerge: the US votes for greater IMF funding for Europe, and in return Europe votes to elect the US candidate as president of the World Bank.

El-Erian is absolutely right about this:

When judged by the Bank’s own criteria for the job, the highly respected Okonjo-Iweala dominates the other two candidates. On that basis, she has already gained the endorsement of influential observers and opinion-forming media outlets. Moreover, her appointment would speak to other important initiatives with which Obama has aligned himself, including efforts to fight corruption, strengthen meritocracy, and support gender equality.

I suspect that, in their hearts, US officials know that Kim, while an inspired nominee, is not the best candidate. Yet their historical attachment to a harmful nationality-based entitlement stops them from opting for the best.

All of which mitigates in favor of Kim getting the job. But El-Erian hasn’t given up hope entirely: if the world’s emerging countries unite behind Ngozi, he says, with Jose Antonio Ocampo being persuaded to step aside, then it will be much harder for the developed world to force Kim onto the Bank. What’s more, they can themselves threaten to oppose the IMF funding increase unless they have a real voice at the table.

Such a move would involve going up, quite explicitly, against the expressed wishes of the US — a move that many countries are understandably reluctant to make. Here, for instance, is Bob Hormats, the US Undersecretary of State, telling Chrystia Freeland that although Ngozi would be “terrific” in the job, Kim is also “very good”, and that “we think he will get support from a lot of countries”. He says that emerging economies should have “a big voice” in the World Bank, just not necessarily when it comes to filling its presidency.

Notably, even Hormats, representing the US, falls short of asserting that Kim is a superior candidate to Ngozi. And it’s worth noting that, at least so far, support for Kim from anybody who isn’t a serving member of the US government is conspicuous by its absence.*

When Christine Lagarde was elected the head of the IMF, there was a credible case to be made that she was the best candidate for the job. And of course all previous “elections” to the World Bank presidency have been uncontested. So if Kim gets the World Bank job, it will be the first time that it has gone to someone who was clearly not the best candidate. Is that really what Obama wants?

*Update: It’s not true that Kim has failed to get endorsements from outside the US government. Treasury has helpfully compiled a list of people who say that Kim is great for the job, which includes the presidents of Rwanda and South Korea; Amartya Sen; and the Washington Post’s editorial board. It also includes Bill Clinton and Paul Farmer, but their conflicts are a bit too obvious. On the other hand, the list does not include link to the endorsements when the endorsements are online, which makes it hard to double-check them. And the FT is included in the list, even though it has actually endorsed Ngozi. So it’s not at all obvious how many of these people really think that Kim is a better choice than Ngozi.

COMMENT

If Ngozi’s getting the job makes it less likely that the US will pony-up more money for the IMF (and possibly – dare one even hope? – withdraw from both IMF and WB) then she has my prayers to go all the way to victory.

Posted by MrRFox | Report as abusive

Why Ngozi Okonjo-Iweala should run the World Bank

Felix Salmon
Mar 30, 2012 21:34 UTC

I first wrote at length about Ngozi Okonjo-Iweala in September 2005, when the magazine gave her its genuinely prestigious Finance Minister of the Year award. It’s here, on my Tumblr, since the original is behind a paywall. (Update: you can read it directly now, Euromoney has taken it out from behind the paywall.)

I think it’s important this story be much better known than it is, because it neatly encapsulates a lot of why Okonjo-Iweala would be a fantastic head of the World Bank. When she arrived as Nigerian finance minister in 2003, the country was what you might call an oil-poor kleptocracy, with virtually no credibility in the international community. Within two years, she had managed to use $12 billion of windfall oil profits to pay off $31 billion in bilateral debt, thereby not only massively improving the country’s debt dynamics, but also ensuring that money didn’t get stolen domestically.

It was an astonishing feat of negotiating prowess, not least because the Paris Club had never before allowed a country to buy back its debt below par, let alone 60% below par. Being able to pull it off involved Okonjo-Iweala leveraging her extremely strong credentials as an economist and finance minister (she has a PhD in regional economics and development from MIT); making full use of her high-powered contacts in the international community; and deftly navigating the labyrinthine bureaucracy surrounding World Bank classifications. Frankly, it’s impossible to imagine any other Nigerian being able to get this particular deal done.

Okonjo-Iweala’s qualifications for the job are well known; see the Economist, the FT, and also this Edward Luce column for good arguments as to why she would be a significantly better World Bank president than Jim Yong Kim. It’s worth reminding ourselves, in this context, of the Bank’s own description of the qualifications required by its president:

A proven track record of leadership;
Experience managing large organizations with international exposure, and a familiarity with the public sector;
Ability to articulate a clear vision of the Bank’s development mission;
A firm commitment to and appreciation for multilateral cooperation; and
Effective and diplomatic communication skills, impartiality and objectivity.

It’s hard to see how Kim can beat Okonjo-Iweala on any of these criteria. Meanwhile, Kim’s own FT op-ed, in which he tries to explain why he’s the right person for the job, is vapid in the extreme. “A more responsive World Bank must meet the challenges of the moment but also foresee those of the future. The World Bank serves all countries.”

Tim Geithner is lobbying for Kim, writing a letter to the Bank’s 187 governors saying that Kim “is committed to pursuing an agenda for the Bank that supports all the necessary components of development,” in a sign that the US doesn’t consider Kim a shoo-in for the job. And consummate Bank insider Lant Pritchett has laid out a credible, if admittedly improbable, series of possible events which could result in Okonjo-Iweala getting the job. “Everyone regretted letting the Americans ram through their choice of Paul Wolfowitz in 2005,” he writes. “The damaging consequences of that fiasco are still fresh in people’s minds.”

Kim is still the favorite for the job, just because he has the full and awesome power of US international diplomatic pressure behind him. But in any fair fight, Okonjo-Iweala would win. And if there are any signs at all that the European vote might not be completely in the bag, we might yet have a real contest on our hands here.

COMMENT

I understand her credentials, but accusations, true or otherwise, of corruption swarm around Nigeria and her.

See: http://saharareporters.com/news-page/wik ileaks-okonjo-iweala-ferried-50-million- jobs-brother

Though she may vow to fight corruption, she needs to first distance herself from it.

I heard her speak at the WEF in 2007 or 2008, and she sounded quite isolationist, saying to leave Africa to the Africans. This is not what is needed for a leader of the World Bank.

Also, if she is such a great candidate, why is Nigeria not doing better, given their wealth of natural resources. Certainly, there is a large hurdle of corruption to overcome, but she has had more than enough time to do overcome this.

I fail to see why she is a better solution, other than she is not an American and she is an African, where much of the World Bank’s initiatives need to be focused. Is there not a better African, who is not saddled with accusations of corruption?

Posted by netvet | Report as abusive

Jim Yong Kim and Dartmouth’s culture of sexual assault

Felix Salmon
Mar 29, 2012 01:00 UTC

What is it about the heads of the World Bank and IMF and their relation with sexual politics? Both Paul Wolfowitz and Dominique Strauss-Kahn lost their jobs because of the way that they treated women, while Strauss-Kahn’s predecessor, Rodrigo de Rato, resigned unexpectedly in the midst of what was described as an “acrimonious divorce”. No woman has ever headed the Bank, and Christine Lagarde is the first woman to head the IMF; they’ve historically been men’s clubs, and none the better for it.

For that reason alone, given the choice between Jim Kim and Ngozi Okonjo-Iweala for the next head of the World Bank, the latter would have something of a natural advantage. But it turns out that Kim’s weakness on the sexual-politics front is much greater than simply being a man.

Janet Reitman has a must-read article in the latest issue of Rolling Stone, detailing the hazing culture at Dartmouth College, where Kim has been the president since 2009. The piece went to press on the day that Barack Obama announced Kim’s nomination, so the news came too late for the story to be recast around Kim. But even as it stands, it’s damning enough.

I’d highly recommend that you read the whole thing, especially the gruesome details of fraternity hazing at Dartmouth, which seems to come very close to qualifying as torture under many definitions of the term. A propos the UN Convention Against Torture, for instance, there’s a case to be made that the severity of the hazing at Dartmouth — forcing youths to recite the frat’s creed while lying in a kiddie pool of ice, for instance, or forcing them to eat “vomlets” made of vomit and eggs — imposes severe suffering on people for the purpose of intimidating or coercing them.

Reitman’s article is centered on Andrew Lohse, who went public with what goes on in secret at Dartmouth fraternities, including forcing youths to chug cups of vinegar until at least one ended up vomiting blood. Here’s how his now-famous op-ed started:

We attend a strange school where a systemic culture of abuse exists under a college president who has the power and experience to change what can only be described as a public health crisis of the utmost importance: the endemic culture of physical and psychological abuse that occupies the heart of Dartmouth’s Greek community. President Jim Yong Kim’s sterling credentials in public health are fundamentally at odds with the pervasive hazing, substance abuse and sexual assault culture that dominates campus social life.

I understand these problems because I myself have endured them. If I were to fully enumerate all of the dehumanizing experiences my friends and I have survived here — experiences that were ironically advertised to us as indispensable elements of the “Dartmouth Experience” — I would have too few words left in this column to adequately explain how the Kim administration has not done enough to address these crises. They have yet to take decisive action to diagnose and cure the abuse that plagues Dartmouth.

Reitman fills out this picture, in the most alarming of ways. What we’re seeing here is not just brutal hazing; it’s also a culture of sexual assault which seems to have reached epidemic proportions.

Brothers aren’t the only ones injured by this unspoken pact around fraternity life. Sexual assault is rampant at Dartmouth; some female students say they circulate the names of men considered “dangerous” and fraternity houses viewed as “unsafe.” Between 2008 and 2010, according to the college’s official statistics, Dartmouth averaged about 15 reports of sexual assault each year among its 6,000 students. Brown, a school with 8,500 students, averaged eight assaults; Harvard, with 21,000 students, had 21. And those numbers are likely just a fraction of the actual count: One study showed that 95 percent of all sexual assaults among college students are never reported. In 2006, Dartmouth’s Sexual Abuse Awareness Program estimated that there were actually 109 incidents on campus…

Nearly every woman I speak to on campus complains of the predatory nature of the fraternities and the dangers that go beyond drinking. “There are always a few guys in every house who are known to use date-rape drugs,” says Stewart Towle…

One senior, who I’ll call Lisa, was “curbed” the second night of her freshman year. She’d been invited to a fraternity by one of its members. Thinking it an honor, Lisa enthusiastically accepted, and once she got there, she had two drinks. The next thing she remembers is waking up in the hospital with an IV in her arm. “Apparently, security found me in front of the house. That was my introduction to the frats: passing out from drinking, waking up in the hospital and not having any idea what happened.” What she did notice were bruises that looked like bites on her chest that hadn’t been there before. “To be very honest,” she says, “I didn’t really want to know what actually happened.”

How did Kim react to the fact that there were literally hundreds of sexual assaults taking place on and by his students while he was president? He “established an intercollegiate collaborative known as the National College Health Improvement Project to study high-risk drinking”, which even Dartmouth spokesman Justin Anderson admits is not designed to actually generate any solutions to the problem.

And as for the whole fraternity culture which spawns these abuses, Kim’s a big fan.

Kim, whose three-story mansion sits on Fraternity Row, is a strong supporter of the Greek system; he has suggested on several occasions that fraternity membership may have health benefits, citing studies that show that people with long-standing friendships suffer fewer heart attacks. In a strange abdication of authority, Kim even professes to have little influence over the fraternities. “I barely have any power,” he told The Dartmouth in a recent interview. “I’m a convener.”

In reality, Kim is one of the only officials in a position to regulate the fraternities. More than half of Dartmouth’s frats are “local” – houses that split off from their national organizations years ago, and are thus unaccountable to any standards other than those set by the college.

In this respect, Kim is much softer on the frats than his predecessor, James Wright, who tried to end the Greek system “as we know it” by requiring fraternities to substantially go coed. Obviously, he failed. But Kim seems to have no problems with fraternities at all: in the same interview, he went so far as to say that it’s “not just the Greek system” which does hazing, and that “you have to look at everybody”. What was he going to do about it? Well, he said, “we’re trying to understand what more we can do.”

Kim even went so far as to meet with Dartmouth’s fraternities to tell them they weren’t in his crosshairs, saying that “one of the things you learn as an anthropologist is that you don’t come in and change the culture.”

And when Lohse presented Dartmouth with copious evidence of just how bad hazing was at his fraternity, SAE, the result was astonishing:

On February 22nd, his 22nd birthday, Lohse received a call from Dartmouth’s office of judicial affairs, informing him that, based on information he’d provided the college, they were pursuing charges against him for hazing. The college has also charged 27 other members of SAE, stemming from events in the 2011 pledge term. While the other students all categorically deny doing anything illegal, the information that Lohse provided to Dartmouth officials may directly implicate him in hazing. As a result, Lohse – the only student to come forward voluntarily – may be the only student who is ultimately punished.

What does all this mean for Kim’s candidacy for president of the World Bank? That’s hard to say. On the one hand, the US basically has the nomination sewn up, since the European countries will always vote for the US candidate in return for the US always voting for the European candidate for head of the IMF. And Europe and the US together constitute an unbeatable voting bloc.

At least, that’s how it has worked until now. The convention that the next head of the IMF will have to be a European is eroding fast, and there are even many European politicians who don’t believe in it any more. And for the first time we’re having a contested race for head of the World Bank, with an incredibly highly-qualified candidate in Okonjo-Iweala; the FT, for one, says she’s “the right leader for the World Bank”. I agree.

So the key constituency here is the European countries, and what they think about Kim’s actions, or lack thereof, at Dartmouth. The college’s culture of hazing and sexual assault is tolerated in the US, but is likely to look unspeakably brutal to European eyes, and I can certainly see many European politicians being extremely uncomfortable voting for a man who did nothing to stop it. The question is: will they read the Rolling Stone article? And if they do, will they be shocked enough that they would be willing to get into a huge diplomatic fight with the US as a result?

The machinations of international politics are rarely particularly edifying, and I suspect that Europe will ultimately fall into line and vote for Kim, just as it has always voted for the US candidate in the past. But if by some miracle Kim loses, and Okonjo-Iweala ends up getting the job, there’s a very good chance that a feature article in Rolling Stone might turn out to be the reason why.

COMMENT

I’m no fan of Jim Kim, but I need to post here in order to correct some of the unfortunate premises of this article. In the US and over in the Northeast, everyone recognizes the Rolling Stone article as a complete hit piece on Dartmouth, filled with an inaccurate and attention-seeking account about what happens at the college. Andrew Lohse, the only source of the article, was kicked out of Dartmouth after doing cocaine and assaulting a security officer (look it up), and was apparently seeking to get revenge and publicity in a desperate plea for attention.

Citing the Rolling Stone as your factual source is regarded as ludicrous over here. To use an analogy, that would be like Reuters citing a story in one of the many British Tabloids and reporting it as an absolute fact. Dartmouth has episodes of drinking, sexual assault, and hazing…but it’s certainly not regarded as any worse than any other American institution. Unfortunate for Jim Kim that this has gotten blown out of proportion, but, well, maybe he deserves it a bit. He was a terrible President of Dartmouth

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Jim Kim!

Felix Salmon
Mar 23, 2012 14:15 UTC

So that was unexpected: the next president of the World Bank is almost certain to be Jim Yong Kim, the co-founder of Partners in Health and the current president of Dartmouth University College.

The news of Kim’s nomination has gone down very well among the punditocracy, and Jeff Sachs already seems to have withdrawn his candidacy in Kim’s favor.

I’m not going to pretend that I’d ever heard of Kim before this morning. But everybody who has heard of Kim seems to think that the choice is a wonderful and inspired one. Kim is a physician by training; he’s a co-founder of Partners In Health, one of the world’s most respected medical NGOs. He’s also a bit of a big-data geek, which is likely to delight the Bank’s wonky employees.

Kim’s prowess when it comes to navigating Washington’s labyrinthine power structures is unknown; I hope he’s up to the job. But he’s going to bring passion and dedication to his task of poverty reduction, along with a welcome bias towards bottom-up rather than top-down solutions. And I suspect that the World Bank’s board will find it easy to rubber-stamp his nomination.

That said, I very much doubt that Kim would stand a remote chance of getting the job in an open and merit-based competition. He has little if any experience dealing with countries at the head-of-state level, and the Bank has historically not been an organization with a particular focus on health initiatives. Cast your mind back just a few days, to when François Bourguignon, Nicholas Stern and Joseph Stiglitz published a piece in the FT calling for the best-qualified candidate to get the job: here are the criteria they listed.

Criteria for shortlisting candidates could be similar to those listed by the IMF board in the procedure that led to the appointment of Christine Lagarde: distinguished record as an economic policymaker, outstanding professional background, familiarity with banking and finance, diplomatic and managerial skills. In the case of the World Bank, solid knowledge and experience of development policy should be added to this list.

Kim has the requisite development-policy background, and also an outstanding professional background, but he’s not a banker, an economist, or a diplomat. It’s also worth looking at his nomination in the light of the stated reason why the head of the World Bank should be an American:

What matters for the World Bank is resources. And keeping an American in charge helps protect those resources.

The United States is the World Bank’s largest donor. That’s been true under both Democratic and Republican administrations. And one of the reasons it’s held so steady, some think, is that the World Bank tends to be led by a high-ranking American official who is able to persuade the White House and Congress to continue supporting the body.

The outgoing World Bank president, for instance, is Bob Zoellick, a highly regarded Republican who served in key positions under both George W. Bush and his father. He was preceded by Paul Wolfowitz, another key Republican policymaker. Many believe the two men played an important role in keeping American financial support for the bank high in years when Republicans controlled the government.

Kim doesn’t strike me as the kind of person who’s particularly great at wrangling Republican votes in Congress. Maybe that doesn’t matter, and all that Congress cares about is that the Bank is run by an American. But this nomination is ultimately a little disappointing, if only because it perpetuates the US hegemony at the Bank at a time when Obama could be opening up the leadership of the institution to a fantastic developing-world candidate instead.

That said, there is one advantage to the convention that the president of the World Bank is nominated by the president of the United States, rather than being chosen in some kind of international beauty contest: it allows POTUS to nominate exactly someone like Kim, a dark-horse candidate who could be wonderful in the job but who doesn’t have a strong international power base. I’m hopeful that Kim will turn out in hindsight to be a wonderful World Bank president, even if (or maybe even because) he couldn’t win the job under the kind of system that most countries want.

COMMENT

He graduated from Muscatine High School a couple years before I attended kindergarten in Muscatine.

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Larry Summers, the revolving door, and the World Bank

Felix Salmon
Mar 23, 2012 06:19 UTC

Remember Krishnan Guru-Murthy’s interview with Larry Summers in January? He asked about Inside Job‘s allegations that Summers was a clear beneficiary of the revolving door. Now see if you can spot a recurring phrase in Larry’s answer:

Whatever I did or did not do, right or wrong, in the Clinton administration, I had earned no significant sum of money prior to working in the Clinton administration, or, in association with the financial sector, for more than five years after I left the Clinton administration. And so any suggestion that what I did in the Clinton administration had to do with loyalty to the financial sector — I think is a bit absurd.

That’s four mentions of “the Clinton administration” in the space of two sentences. The idea, it seems, is that if you wait a few years before availing yourself of that revolving door, then that means you can’t have been conflicted in office.

This interview has new salience right now, not only because Summers is arguably the favorite candidate to be the next head of the World Bank, but also because John Cassidy has now confirmed what many of us predicted well in advance: Summers is back working at DE Shaw, and presumably making many millions of dollars per year for doing so. This time, he didn’t wait five years; he didn’t even wait one.

Now according to Larry’s own logic in the answer he gave to Guru-Murthy, it’s perfectly reasonable, given the alacrity with which he accepted DE Shaw’s millions, to ascribe his actions in the Obama administration to loyalty to the financial sector. We now know that when Summers was giving this interview, he was already back at work for DE Shaw. Which is why he was so careful to confine his answer only to his activities during the Clinton years. If accused of being a creature of the revolving door during the Obama years, he could adduce no such defense: he literally left DE Shaw to join the Obama administration, and then revolved straight back into that job when his temporary government gig was over.

Cassidy is right to point out that Wall Street ties are hardly unprecedented in World Bank presidents. But there’s still something opportunistic and sleazy here: Summers isn’t a banker, so much as he’s just selling the fruits of his government experience to the highest bidder, even as one of his rivals for the World Bank job, Jeff Sachs, is taking to twitter to remind anybody who will listen of even sleazier episodes in Summers’s past.

Sachs isn’t helping his cause with that kind of tweeting. But the truth is Summers can’t relish a contest between himself and Ngozi Okonjo-Iweala. Summers paid $31 million (Harvard’s money, of course, not his own) to settle a lawsuit over Andrei Shleifer’s disgraceful behavior in Russia, while keeping Shleifer at Harvard as a faculty member in good standing. Ngozi Okonjo-Iweala, by contrast, well, I’ll let her tell the story:

From 1967 to ’70, Nigeria fought a war: the Nigeria-Biafra war. And in the middle of that war, I was 14 years old… We were on the Biafran side. And we were down to eating one meal a day, running from place to place, but wherever we could help we did. At a certain point in time, in 1969, things were really bad. We were down to almost nothing in terms of a meal a day. People, children were dying of kwashiorkor. I’m sure some of you who are not so young will remember those pictures. Well, I was in the middle of it. In the midst of all this, my mother fell ill with a stomach ailment for two or three days. We thought she was going to die. My father was not there. He was in the army. So I was the oldest person in the house. My sister fell very ill with malaria. She was three years old and I was 15. And she had such a high fever. We tried everything. It didn’t look like it was going to work.

Until we heard that 10 kilometers away there was a doctor, who was able … who was giving … looking at people and giving them meds. Now I put my sister on my back, burning, and I walked 10 kilometers with her strapped on my back. It was really hot. I was very hungry. I was scared because I knew her life depended on my getting to this woman. We heard there was a woman doctor who was treating people. I walked 10 kilometers, putting one foot in front of the other. I got there and I saw huge crowds. Almost a thousand people were there, trying to break down the door. She was doing this in a church. How was I going to get in? I had to crawl in between the legs of these people with my sister strapped on my back, find a way to a window. And while they were trying to break down the door, I climbed in through the window, and jumped in. This woman told me it was in the nick of time. By the time we jumped into that hall, she was barely moving. She gave a shot of her chloroquine, what I learned was the chloroquine, then gave her some, it must have been a re-hydration, and some other therapies, and put us in a corner. In about two to three hours, she started to move. And then, they toweled her down because she started sweating, which was a good sign. And then my sister woke up. And about five or six hours later, she said we could go home. I strapped her on my back. I walked the 10 kilometers back and it was the shortest walk I ever had. I was so happy that my sister was alive. Today, she’s 41 years old, a mother of three, and she’s a physician saving other lives.

It’s almost inconceivable to me that Barack Obama, the proud African-American who wrote Dreams from My Father, could ever with a straight face claim that Larry would be a better choice to run the World Bank than Ngozi. Larry has made it abundantly clear that the only thing he values more than money is power. His decision to rejoin DE Shaw is what economists would call a “revealed preference”. And what it has revealed, as if there was any doubt, is that Summers is not the right person for the World Bank job. He wants to work for DE Shaw? Fine. Let him stay there.

COMMENT

Mr. Summers recently recently said that learning languages other than English was a waste of time: hardly an appropriate mentality for someone wanting to hold an international post.

Posted by logicus | Report as abusive
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