Global Development: Views from the Center

"open, competitive and merit-based process", "the necessary management experience, understanding of development issues, and political smarts to lead the bank effectively", etc. all sound very nice, but may be rather Panglossian in this context. Mirroring the WB's essentially political nature, all the EDs of the WB are political appointees. One should not be surprised that the choice of the President is also essentially a highly politicized process. Merit, Managerial Experience, understanding of development issues, etc., could be useful, although it may have been in short supply among the WB presidents for some time now. Actually, Paul Wolfowitz has been one of the few WB presidents of the past forty years (or more) who has actually lived and worked in a developing country (Indonesia).

One of the real advantages of past WB presidents was that they had a good senior staff. Those of us old enough, remember J. Burke Knapp and Warren Baum. Then came Ernie Stern. Unfortunately, Wolfensohn broke the tradition by instead surrounding himself with yes men/women, and proved unable to establish priorities.

I wonder if the task of overseeing the WB can really be left to "the nations of the world" -- i.e., a bunch of politicians. Perhaps there should instead be introduced a more important role for the capital markets to exercise a major part -- if not all -- of that oversight, by removing any vestige of guarantee for the WB bonds by the member states, which is currently the case. Can you imagine a weekly conference call between the WB Senior Management and the major participants in the world money markets discussing the WB's financial performance, such as GE or Credit Suisse or ABN AMRO has to do? The results of those conversations could be immediately visible in the value of the WB's outstanding debt instruments! This might do a whole lot more for transparency and accountability than utopian political approaches to the problem.

In all the flurry of activity around ousting Paul Wolfowitz, Del hits on an important issue -- why isn't anyone bringing the same level of scrutiny and calls for a "merit-based process" for appointing Board member with "the necessary management experience, understanding of development issues, and political smarts to lead the bank effectively"? Why isn't anyone running a cost-benefit analysis of maintaining resident Boards at all of the IFIs? And, as Del suggests, maybe it's time to introduce some non-governmental representation to the Boards ala the model of the Millennium Challenge Corporation.

To paraphrase Clemenceau, like wars the running of the World Bank is too critical to be left to politicians. While a WB president needs political savvy he/she (though the latter is an oxymoron as no woman has even been mentioned as a potential candidate:must we assume none are capable? )they do not need to be former politicians in search of work a la Wolfowitz and, unfortunately, too many WB staff. Nor do they need to be cronies of politicians. This is a major, usually unadmitted flaw in too many multi-lateral organizations which is encouraged by recruitment quota systems and power-broking. A transparent system of recruitment at all levels would be a useful first step to refrom in the WB.

Sebastian Mallaby’s op-ed piece in Friday's Washington Post http://www.washingtonpost.com/wp-dyn/content/article/2007/05/17/AR2007051702093.html
is refreshingly different from much of the recent coverage of the World Bank, because it succinctly explains how the Bank's policies to help poor countries have evolved over several decades and then points to some of the Bank's past successes as aspects of its work on which the 21st century institution should build. In his second-to-last paragraph, in order to convey a vision of the 21st century World Bank as a "Knowledge Bank", Mallaby uses the Bank's support for so-called "public disclosure" policy as one example of how the Bank can use sophisticated tools to strengthen institutions and reduce corruption. Mallaby cites work in Uganda and also mentions clean water. Work on public disclosure by my colleague David Wheeler ( http://www.cgdev.org/content/experts/detail/11584/ ) preceded these two examples by as much as a decade. His World Bank team collaborated with national environmental agencies to develop nationwide public disclosure programs in Indonesia http://www.worldbank.org/research/greening/cha3new.htm, and China http://econ.worldbank.org/external/default/main?pagePK=64165259&theSitePK=469372&piPK=64165421&menuPK=64166093&entityID=000094946_02100304104987
Another product of the "Knowledge Bank" that argues the case for public disclosure is the 2004 World Development Report, entitled "Making Services Work for Poor People". http://go.worldbank.org/X58Y8F0U50 World Bank support for a country's implementation of a public disclosure policy requires less money and more technical advice than would more traditional government interventions. What kind of reforms would help the World Bank adjust its mix of products away the provision of financial support and towards more effort to seek out, demonstrate and promote good ideas like this one?