Pride Goes Before a (Wind)Fall

Last quarter I wrote a paper on IMF and World Bank structural adjustment programs in Haiti. These well-intentioned but misguided programs aimed to sponsor industrial growth and general upliftment throughout the country. Instead, they led to agricultural atrophy and economic stagnation.

The so-called SAP's, the now discredited mental byproduct of the neoliberal school of economic thought, wrought havoc in many developing countries before they were finally brought to heel. But for me, who'd always believed the World Bank was a knight in shining green armor, learning that the men behind the curtain at the WB had messed up was a little like learning Santa doesn't bring presents to Hindus.

I was upset. I said to my TA, "Why does anyone even trust the World Bank anymore?" He replied, "They don't. The World Bank and the IMF are some of the most hated institutions in the world right now."

Maybe he was exaggerating. After all, what happened to Gitmo? But nonetheless, the comment suggests what many power-brokers already know. The Bank was rotten to the core, and the now-ended Wolfowitz-Riza debacle was just another sad story in a series of tragedies. Over the years, the WB has developed the image of a Western toadie, its dedication to democracy relegated to the same closet as ethics reviews and responsible hiring.

The debate over Wolfowitz was, at its heart, a debate over who was responsible for this decline in image. Wolfy, a Bush neocon, represented all that was wrong with American diplomacy: its hypocrisy, cronyism and hamfistedness. Meanwhile, the European Powers That Be, who had long felt like spectators at a U.S. vs. Developing World soccer match, insisted that this whole mess could have been avoided, if only someone had listened to them.

It's a common refrain these days, and hindsight is perfect, so we'll never know who's actually right. A recent article in Newsweek does point out the obvious: no one ever cared about Wolfowitz. He was a symbol of the corrupt partnership between the WB and the US. His ludicrous pay package - indeed, the ludicious pay awarded to most WB employees - brought back memories of the abuse of WB funds that Wolfowitz once blessed as a highly-paid ambassador to Southeast Asia. Wolfowitz is yet another crony CEO, whose pay never reflected his performance. In this, he is the image of what the rest of the world is starting to think about America: crony CEO's, unable to finance their debt or cheaply produce their own goods, living off the sweat and savings of the rest of the world. He didn't deserve his good fortune, and neither do we.

It was too much to stomach, and it was only a matter of time before Europe tried to toss Wolfy out on his ear. The assumption is that now, if Europeans get on top once more, the world will see a smarter, gentler capitalism. You don't have to be for it or against it. You don't care whether God blesses it. Hey, says Europe, you can't spread this stuff by force.

And the World Bank will rise from the ashes.

We'll see. Whether this Resurrection is possible - and let's not forget Europe's record of colonial exploitation - is a matter for the history books. In the meantime, the developed world can sit back, relax, and enjoy the fruits of other people's labor.