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Barack Obama

Bully's choice for World Bank a betrayal of hope

PUBLISHED : Saturday, 21 April, 2012, 12:00am
UPDATED : Saturday, 21 April, 2012, 12:00am

So, US President Barack Obama and his treasury secretary, Timothy Geithner, finally steamrollered their choice of Jim Yong Kim into the president's job at the World Bank, with the slavish support of Japan - which shamefully declared for Kim without bothering to listen to the other candidates - plus Europe, Canada, Mexico and Russia, at least.

Kim will have to fight the accusation that he was chosen not because he was the best candidate but because Obama exercised the bully's choice. It is a betrayal of the hopes of the world and of Obama's - 'Yes, we can' - own promises to make a difference.

In its own operations, the World Bank insists that countries receiving its money must practise good governance. This is quite right. There is little point in lending money if it is going to be squandered in bad government or corruption, and among the oldest and most pernicious forms of corruption are nepotism and putting favoured friends into top jobs.

The hoodwinked commentariat claimed this was an unprecedented election because there were three candidates. But, in a proper election, there is an open process of nomination, candidates get a chance to state their case, to debate with each other, to be questioned, and then votes are taken, counted and certified: an open, merit-based, fair and transparent choice - the promise that Obama and his friends betrayed.

Kim was chosen by the US, which pressurised other countries through the old-boy network to fall into line. They did. Kim's campaign was run from inside the US Treasury, which organised, promoted and presumably paid for his world 'listening' tour, an advantage that the other candidates did not have.

The actual election was more secretive than a conclave of cardinals electing a pope; they know the characters, and strengths and weaknesses of the papabile. Who knows about Kim's fitness for the job?

Who knows also who supported him? Japan admitted to dancing to Washington's tune. But what about Beijing and Delhi, both remarkably silent? Did you cut a deal: support Kim and get some more of the top jobs? This would be potentially even more dangerous corruption. This is supposed to be the World Bank, not the US bank or Europe's or China's.

Obama had a great chance to open the World Bank to the world by not backing anyone and inviting the qualified to apply: those who have run a big organisation with a brilliant but temperamental multicultural, multinational staff; dealt with a US$250billion loan book and understand banking and finance; wrestled with the pernicious problems of politics and corruption in developing countries; understand the minefield of economic development at the grass roots - and with a brave heart, a strong mind and a lively imagination to realise that the World Bank has the best foundation for tackling some of the dangerous, intractable problems of the 21st century, such as food, water, energy and unemployment.

Kim now has to make the transition from running a small Ivy League college with a bad frat-boy reputation, 6,000 students and a US$100million hole in its budget, to a global institution with a US$250billion portfolio, a few billion clients and all the developing problems of the world.

Distinguished economists have praised Kim's achievements in global health, specifically HIV/Aids, and in promoting change from the grass roots upwards. But health is only a small, though important, part of his new job, and he won't be able to whizz down to villages to give money or provide treatment to distressed families.

He has to deal with governments. The 187 member governments are the shareholders of the World Bank. They sign off on everything. Most loans are made to governments. They don't like criticism. The best that the bank can do in the face of rampant corruption or gross incompetence is stop lending money.

Obama's choice makes Kim dangerously a prisoner of the US and a prisoner of any other country with which Washington cut a deal. This is the World Bank's problem and the world's.

Kevin Rafferty has reported on the World Bank for 35 years and was managing editor at the bank from 1997 to 1999