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April 22, 2007

Crisis Mode Grips World Bank Headquarters


by Jim Lobe

There is a crisis atmosphere at World Bank headquarters here in Washington, with dozens of emergency staff meetings, more calls for the embattled president Paul Wolfowitz to step down, and clearer displays of rebellion inside the Bank.

Bank sources speaking to IPS on condition of anonymity reported Friday intense emergency meeting activities "at all levels of staff," in which senior staff are asking their subordinates to meet with their own staff in turn to "take their pulse" and "talk."

The goal of the meetings appears to be an attempt from leading staff to gather data and then inform senior management and vice presidents with regards to the real employee sentiment inside the World Bank, which employs more than 10,000 people.

Joining a long line of critics of former U.S. deputy secretary of defense Wolfowitz, additional Bank officials are urging the institution's president to step down.

Two sources confirmed to IPS that about 110 country directors, their deputies and program coordinators sent a message Friday saying they want Wolfowitz out.

At issue is a scandal involving excessive pay he coordinated for his girlfriend and then-Bank staffer Shaha Riza at a time when he was spearheading an anti-corruption campaign at the Bank and in its projects.

The officials, many of them considered senior staff, had met with Wolfowitz Wednesday at the Watergate office complex in Washington DC, where he was asked repeatedly to resign. At least four country directors publicly called upon him to leave his job which he took in June 2005, the sources say.

The officials were in Washington for the annual meetings of the World Bank and its sister institution the International Monetary Fund last weekend.

The sources say the officials then met with Graeme Wheeler, the World Bank managing director, and Jeff Gutman, vice president and network head for operation and country services. More than 100 people were in attendance, the source says.

Wheeler, who had called for Wolfowitz's resignation a day earlier, received "a huge ovation" for his position, the source says.

During the meeting the officials insisted that Gutman deliver "a strong message of consensus from virtually all present to the president [Paul Wolfowitz] and the dean of the Board [and Germany's executive director, Eckhard Deutscher] that he [Wolfowitz] should step down."

The message was to be delivered Friday morning.

While Gutman didn't return repeated phone calls from IPS asking for clarification on whether the statement was actually delivered, a Bank source familiar with the issue said the message was actually conveyed.

Inside the Bank's buildings on H Street in Washington, hundreds of staff members were taking their mutiny a step further. They called for good governance in the Bank and showed their displeasure at the Riza nepotism controversy by wearing blue ribbons, similar to the red ribbon used internationally as a symbol of the fight against dangerous diseases and AIDS.

World Bank country offices and development experts from around the world are now even asking for their share of the blue ribbons to wear, but were told to make them locally, one source said.

The developments demonstrate the escalating rebellion that has gripped the Bank is gaining strength, as Wolfowitz himself continues to dodge calls for his resignation.

On Friday he said he will wait for the Bank's 24-member Board of Directors to tell him what to do next and whether he actually violated Bank staff rules by directing a pay hike to his girlfriend and then trying to cover it up.

But the Board, too, was in emergency gear.

Their last meeting over the issue extended from Thursday evening, through the night and ended around 2:00 am on Friday.

The marathon meeting netted only a lukewarm statement however, saying that they have asked the Board's Committee on Governance and Administrative Matters (COGAM) to make the final recommendations "on issues of internal governance."

The executive directors said they discussed questions related to conflicts of interest and possible violations of staff rules and said the ad hoc group will make early recommendations to them for a decision.

Wolfowitz responded by issuing a statement repeating his earlier position that he will abide by the Board's decision.

"President Paul Wolfowitz welcomes the decision of the Board to move forward and resolve this very important issue. He looks forward to implementing the recommendations of the Board," the statement said.

That exchange makes it clear that Wolfowitz's fate is still uncertain and the Bank will linger on under the corruption cloud for more days.

On the outside, too, the scandal besetting Wolfowitz continued to reverberate with his critics taking to popular online video websites to air their grievances.

A posting on the Internet video site YouTube.com by AVAAZ.org, an international grassroots organization, declares that the World Bank, which lent some 23 billion dollars last year for projects in developing and impoverished nations with direct impact on millions of lives, shouldn't be "a punch-line."

The clipping shows a scene from a speech Wolfowitz gave to his staff when he first took on the job: "Firing employees... that's unfortunately part of doing business," he says.

The next screen shows this banner: "Fire Wolfowitz."


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  • Jim Lobe, works as Inter Press Service's correspondent in the Washington, D.C., bureau. He has followed the ups and downs of neo-conservatives since well before their rise in the aftermath of the September 11, 2001 attacks.

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