Monday, April 16, 2007

President Paul Wolfowitz of the World Bank should apologize once more (since multiple apologies are the norm) for succumbing to the petty temptation of favoritism, and step down. His work to arrange a State Department job with unreasonable promotions and raises for his girlfriend, Shaha Riza, an employee of the World Bank when Mr. Wolfowitz took over in 2005, are clearly unethical. Such impropriety is particularly unacceptable in an organization that strives to reduce poverty and promote development through good governance. Mr. Wolfowitz’s agenda for the bank is the right one, but he has surrendered his ability to pursue it.

In March, the World Bank released a thorough report detailing its focus on governance and fighting corruption. Drawing on interviews with representatives from government and civil-society groups, donors and others in 47 countries over the course of a year, the report puts forth the World Bank’s plan to reduce corruption “as an integral part of its work to reduce poverty and promote growth.” To champion and promote good governance the bank itself must exemplify it. No matter how sincere his apology, nor how otherwise laudable his policies, Mr. Wolfowitz has lost the reputation for ethical impeccability on which the World Bank relies.

Wolfowitz defenders argue that his transgressions were unwitting, resulting from an effort to work in good faith and follow the direction of the ethics committee, and were subsequently misrepresented by a subjective presentation in the press. The argument first asserts that Mr. Wolfowitz tried to recuse himself completely from all matters pertaining to Miss Riza, but the World Bank’s board nonetheless set up an ethics committee to review the situation. Only after specific instructions from the ethics committee, the argument then asserts, did Mr. Wolfowitz contact the human resources vice president with instructions for dealing with Miss Riza. The first assertion is false, and the second only half true.

This defense is based on documents released by the World Bank at Mr. Wolfowitz’s insistence, but it overlooks several key aspects of the story. Mr. Wolfowitz did not intend to fully recuse himself from matters pertaining to Miss Riza. A letter from the bank’s general counsel suggested Mr. Wolfowitz’s willingness to do so, but an e-mail response to that letter from Mr. Wolfowitz’s lawyer, reported in The Washington Post, clearly rejects it: the proposed resolution “WOULD NOT — I REPEAT, NOT — INVOLVE RECUSAL FROM PROFESSIONAL CONTACT” with Miss Riza.

After considering either “an in situ promotion” for Miss Riza or “an ad hoc salary increase,” the ethics committee recommended the former and asked Mr. Wolfowitz to advise the human resources vice president. The bank president, however, asked the human resources department to bestow on his girlfriend both a series of assured promotions and a generous schedule of pay raises, starting with a bump from $132,660 to $180,000, then to $193,590 ten months later. The bank’s board said it had not “reviewed or approved” that compensation.

If good governance were not such a high priority of the World Bank — or were Mr. Wolfowitz head of another organization — then the appropriate punishment for Mr. Wolfowitz’s lapse of judgement, weighed against the benefits of his commendable policy initiatives and high skill, might be a firm censure and continued tenure. But combating corruption in developing countries is central to the World Bank’s function, and because he engaged in the kind of political favoritism his organization seeks to root out, Mr. Wolfowitz can’t advance that goal, nor will he easily resurrect his reputation. His leadership has been rendered ineffective. The only honorable choice is to resign.

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