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Talking Points: Wolfowitz’s Misdeeds

As president of the World Bank, Paul Wolfowitz has shirked the bank's unifying mission in favor of advancing his private agenda.

“The World Bank is a vital source of financial and technical assistance to developing countries around the world,” with its central mission being global poverty reduction and the improvement of living standards. But as president of the World Bank, Paul Wolfowitz has shirked the bank’s unifying mission in favor of advancing his private agenda. Today, Wolfowitz “faces a panel of the bank’s directors in Washington over his personal intervention to secure pay increases and benefits for his girlfriend.” “Wolfowitz intends to offer a ‘substantial‘ defense of his actions, showing there was no conflict of interest in the steps he took on behalf of [his girlfriend] Shaha Riza.” But his engineering of the pay raise for Riza has already been concluded to have breached ethics rules, and the bank panel will also investigate Wolfowitz’s “hiring of former White House aides to influential, and highly paid, jobs in his inner circle.” Wolfowitz’s deep-seated cronyism reflects how his corruption and right-wing agenda have extended far past the scandal surrounding Riza’s salary and pervades several different facets of the World Bank’s development policies.

  • Wolfowitz has brought the cronyism of the Iraq war to the World Bank. Faced with growing criticism over the Riza scandal today, Wolfowitz argued, “For people who disagree with things they associate with me in my previous job, I am not in my previous job.” But Wolfowitz has let his previous position impose a heavy influence at the bank. He secured an exorbitant salary for Riza, who “reinforced Wolfowitz’s resolve” to invade Iraq. Moreover, of five top bank officials appointed by Wolfowitz, three were senior leaders of governments that provided strong backing for U.S. policy in Iraq. In February, the Government Accountability Project learned that Wolfowitz planned to expand the bank’s lending operations in Iraq, despite there being “no functioning banking system” to secure those loans. Wolfowitz has also appointed advisers to Vice President Dick Cheney and Sen. Mitch McConnell (R-KY) to influential positions within the bank.
  • As the leader of the World Bank, Wolfowitz continues to impose Bush’s conservative social policies on international development. Documents uncovered this month reveal Wolfowitz and his right-wing appointees attempted to reverse a long-standing family planning policy at the World Bank. Juan Jose Daboub, an Iraq war ally appointed by Wolfowitz, “instructed a team of bank specialists to delete all references to family planning from the proposed Country Assistance Strategy for Madagascar,” even though the country’s government has specifically asked for help in that area. Additionally, a draft of the pending Health, Nutrition, and Population Strategy, obtained from Daboub’s office, mentions family planning just once (p. 120). Bush’s top scientists came under fire from Congress last month for repeatedly editing government documents to play down links between emissions and global warming. Wolfowitz’s appointees at the World Bank have continued these revisionist tactics of global warming denial, as bank scientists recently disclosed that Daboub eliminated references to climate change in the Clean Energy Investment Framework, “a key strategy paper presented to the bank’s shareholder governments at its annual meeting in Singapore last September.” Daboub “tried to remove some references to climate change completely and, in other cases, replace them with the phrases ‘climate risk’ and ‘climate variability,’ which convey greater uncertainty over the human impact on climate.”
  • The evidence of Wolfowitz’s misdeeds continues to mount. Calls for Wolfowitz to resign his position from the World Bank have stemmed from the European Parliament, World Bank executives, and aid organizations like OxFam, who all believe he should no longer function as president in the wake of the current scandal. Wolfowitz has attempted to deflect blame towards the bank, accusing the board of treating him “shabbily and unfairly.” Furthermore, today he is expected to argue that “the institution’s ethics committee knew of his involvement in securing a promotion and pay raise for his girlfriend,” implying that the committee knew of and approved the arrangement. But recently uncovered documents indicate that Wolfowitz attempted to “cover his tracks” over Riza’s salary. “It now emerges that in a letter written in response to a ‘brief conversation’ and dated 13 July 2006, the bank’s vice-president, Xavier Coll, told Mr. Wolfowitz that it was ‘virtually impossible’ to shut off access to individual salary details,” suggesting Wolfowitz knew of the improper nature of the salary arrangement and attempted to hide it from scrutiny.