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The World Bank's Choice: Love Wolfowitz, or Hate Freedom

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By Al Kamen
Wednesday, April 18, 2007

The World Bank's board of directors is scheduled to convene tomorrow and may try to figure out what to do about calls that the bank's president, Paul Wolfowitz, resign because he gave a big raise and promotion to his girlfriend, Shaha Riza.

The flap over the raise follows bitter controversy ever since Wolfowitz took over in June 2005. Detractors say his dependence on overpaid cronies, general mismanagement, adherence to Bush administration priorities and high-handedness, now followed by this problem, have destroyed his credibility.

Wolfowitz's supporters say the controversy is really about corruption: Either you're for it or against it. Wolfowitz is against it. His enemies, therefore, are for it.

Okay, maybe his campaign against nepotism and fraud and such might have been a tad undercut by Raisegate. But remember, transparency is important. And, as he told reporters, "I didn't hide anything that I did."

Indeed, he typed, checked the margins and spacing, looked for spelling and syntax errors, and then actually signed an order directing that his girlfriend be given a promotion, a raise of about $50,000, and then some fine future raises and promotions after she went, still on the World Bank tab, to work at the State Department.

Contrary to the impression left by the media, those future promotions were not automatic. The order said her performance outside the bank would be reviewed by a "committee of her peers" acceptable to her. (The directive doesn't say so, but custom dictates that no more than one committee member can be a close relative and no more than one can be a former college roommate.) Wolfowitz also indicated that he was under intense pressure to resolve this and was concerned Riza might sue the bank -- though we're told the bank has sovereign immunity.

And he's admitted he made a "mistake." Why isn't that enough? his supporters ask.

Well, the answer simply must be that the pro-corruption crowd -- the Brits, French, Germans, Dutch, Italians and other Euros, who in all provide around 40 percent of the bank's loans to poor countries -- somehow are worried that recipients might be forced to be honest. And the Euros include some "Wolfowitz haters" who, not coincidentally, also hate freedom.

In contrast, Wolfowitz's staunchest backers outside Washington tend to be from loan-recipient countries. They are strongly anti-corruption. Of course, over the years, some may have slipped up from time to time -- okay, maybe constantly -- but still . . .

So take your pick on what this is about. As the late, great Indonesian president Suharto is said to have observed to former bank chief James Wolfensohn: "In Indonesia, corruption was family values."

One Smart Cookie -- and Persistent, Too

Sen. Chuck Schumer (D-N.Y.), the gift cookie that keeps on giving. A couple of Loop Fans grabbed takeout Sunday night from Hunan Dynasty on Capitol Hill. They had just finished the fine chicken with cashews and turned to the fortune cookies.

The first one popped out: "You will read and positively love 'Positively American,' the new book by Senator Chuck Schumer." Could it be that Schumer, whose book made the New York Times bestseller list a few months ago but now ranks 35,279 on Amazon.com, is still out there hawking it through fortune cookies?


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