Editorial

Democracy versus imperialism at World Bank

Sunday, March 25, 2012    

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Will democracy prevail in the selection of the new president of the World Bank, or will imperialism continue its unbroken 50-year stranglehold in the form of yet another American?

The presidency of the World Bank has, since its establishment, been the prerogative of the United States in a Faustian deal with Europe in which the managing director of the International Monetary Fund (IMF) has always been a European.

The game plan has been unchanged since 1944, although the selection process is completely lacking in democracy, transparency and fairness. It has often deprived the twin institutions of suitably qualified leadership. Merit in the form of qualification, knowledge of the subject matter and relevant previous experience play little or no part in who is chosen by the US and the EU.

Over the last half-a-century, the imperialist practice has roiled the rest of the world. Long gone are the days when the majority of the world was under colonial rule and less than 40 countries were in attendance at the founding meetings at Bretton Woods. In those days the hegemony of the US was at its zenith and it was the only country with the resources to fund these institutions. So it naturally became the largest shareholder, which remains the same today.

The world, however, has changed. There are now almost 200 nation states, and while the US is the sole superpower there is now greater balance, especially in terms of economic power. Concomitant with a new world order have been persistent and increasingly vociferous demands for a merit-based selection process.

The G-20 agreed that the selection process for the head of the IMF and the World Bank would be transparent and based on merit. No sooner was the ink dry on this solemn commitment than the French perniciously disregarded the mandate, aided and abetted by the US, EU, Japan and China.

The US is faced with the choice between being patriotically American or living up to the principles of good global citizenship, which it so ardently espouses. The dilemma for the Obama administration is, having an American head the World Bank panders to the hubris which is so virulent in Congress which has to authorise US contributions to the international institutions. The appointment of a non-American is certainly a risk, given the Republican views. In an election year, it could be portrayed as a sign of President Obama's so-called failure to maintain American hegemony.

One likely strategy is to adopt the French tactic used to unjustifiably prolong its 28-year monopoly of the post of managing director of the IMF. This was to nominate a woman for the first time, thereby deflecting the argument of it not being open to all. Anyone opposed was put in the invidious position of being politically incorrect on gender equality.

The case of the presidency of the World Bank being an American is particularly egregious because the job should be held by a person from a developing country because they would be knowledgeable and empathetic to economic development and would certainly be the right political optics lending credence to democracy and transparency in global governance.

The US has nominated Jim Yong Kim, a Korean-American and president of Dartmouth College, to become the next president of the World Bank. Curiously he is not an economist but is a medical doctor. There are several better qualified developing country economists whom we'll not name but who could easily fill the post.

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