Joseph Stiglitz, the former chief
economist of the World Bank and one of the world's most influential
economic thinkers, has launched a savage attack on US plans to appoint
Paul Wolfowitz as the World Bank's new president.
In an exclusive interview, the American Nobel laureate said: "The
World Bank will once again become a hate figure. This could bring street
protests and violence across the developing world." He described
President Bush's determination to appoint his deputy defense secretary to
the important post as "either an act of provocation or an act so
insensitive as to look like provocation". Wolfowitz is widely
regarded as the creator of the policy that led to the US war in
Iraq.
The choice of Wolfowitz has also created a dilemma for Tony Blair and
Gordon Brown. They fear he would stand in the way of their high-profile
initiative to alleviate African debt and poverty. However, they are
reluctant to spark a dispute with the White House by going public with
their concerns. "This is a big problem for us," said an
official close to the chancellor. "We are still working out what to
do."
The presidency of the World Bank is in the gift of the White House, while
the International Monetary Fund, its sister body, is normally run by a
European. The Bank is the world's most important development institution.
It is the main lender to poorer countries for a whole range of projects,
including the fight against poverty and HIV/Aids.
In an interview with Liam Halligan, the economics correspondent of
Channel 4 news, Stiglitz said he was concerned that the Bank would
"become an explicit instrument of US foreign policy". He added:
"It will presumably take a lead role in Iraqi reconstruction, for
instance. That would jeopardize its role as a multilateral development
body."
This is Stiglitz's first public utterance since last week's nomination.
When he was the World Bank's chief economist - under the current
president James Wolfensohn, whose decade-long tenure ends in June - he
played a major role in rebuilding its battered reputation.
Stiglitz said Wolfowitz was unsuitable in part because the US war in Iraq
remains profoundly unpopular in many of the territories where the World
Bank works. But he also complained that Wolfowitz has the wrong
skills.
"He has no training or experience in economic development or
financial markets," Stiglitz said. The Bank was the most important
institution addressing poverty, he said. "We need someone in charge
who knows. . . development."
© Copyright 2005 Telegraph Group Limited
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Michael A. Lebowitz
Professor Emeritus
Economics Department
Simon Fraser University
Burnaby, B.C., Canada V5A 1S6
Currently based in Venezuela. Can be reached at
Residencias Anauco Suites
Departamento 601
Parque Central, Zona Postal 1010, Oficina 1
Caracas, Venezuela
(58-212) 573-4111
fax: (58-212) 573-7724