ACCUMULATING PERIPHERALS


More Disgusting Than That Time He Licked a Comb by mattsteinglass
April 13, 2007, 3:14 pm
Filed under: Development, United States, Vietnam

Paul Wolfowitz’s antics at the World Bank — handing out ultracushy salaries to two inexperienced cronies and a girlfriend — have exposed the institution to charges of hypocrisy in its anti-corruption drive. Sebastian Mallaby sketches the broader consequences: Wolfowitz’s divisive and arguably corrupt tenure has sucked away the Bank’s momentum at a time when such momentum is sorely needed, to remind the first world of the consequences of ignoring the third. Matthew Yglesias weighs in here. (Brad DeLong: “If you had asked me six years ago if Paul Wolfowitz was the kind of person who would tell the head of HR to give his girlfriend a $50K raise, I would have said yes.”)

What’s really depressing is that once an institution’s authority is tarred by this sort of misbehavior, it takes a really, really long time to win it back. And that will have miserable consequences. In February 2006, for instance, Vietnam uncovered a massive corruption scandal in a contracting unit at the Transportation Ministry that had received millions of dollars in World Bank loans. The Bank sent an investigative unit out to find out whether any of its money was involved. The unit didn’t release its findings until December, and it said none of its money had been misused. Leaving aside the question of how thoroughly one thinks the Bank investigated this affair, the question now is: if World Bank auditors came to a country like Vietnam today, would anyone care what they found? Poor countries now have a ready-made excuse to defend any corruption in their use of World Bank funds — and not because of any institutional failings by the Bank, but just because of how one poorly chosen Bank president conducted himself. Who knows how long it will take the Bank to win its credibility back. What a disgusting waste.

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