Bretton Woods Corruption 21

I thought I would stun everyone this morning by saying something in partial defence of Paul Wolfowitz.

The big surprise about the current scandal is that the man has a girlfriend. If he used his position to lever pay increases for her, he should resign. Let him pay for his own sex.

This undermines his hypocrisy in launching a drive aganst corruption at the World Bank. The irony is he was actually right about corruption. Corruption in the World Bank is massive. I recall in the 1980’s in Nigeria watching billions of dollars poured into inappropriate agricultural programmes, the whole design of which was intended to be capital intensive, to provide the maximum flows to skim. We estimated that 30% of the money was lost to corruption. And yes, the World Bank staff were up to their neck in it. Things have changed a little since then, but not much.

In Nigeria the problem was a combination of a massively corrupt local political structre, and World Bank staff largely drawn from the corrupt elite of the Indian sub-continent. Add into that mix Western contractors and suppliers willing to pay huge bribes, and their governments willing to turn a blind eye.

All of those aspects of the problem need to be tackled. Wolfowitz was not focusing on the Western elements, of course. But that does not make him wrong about the culture of corruption. It is good the issue was forced, and our own loathing of Wolfowitz should not blind us to the fact that the opposition to him of many World Bank staff is from the worst of motives.

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21 thoughts on “Bretton Woods Corruption

  • writeon


    It seems pretty clear that Wolfowitz, did, indeed, use his position to lever a pay increase for his "girlfriend", I think I prefer the old-fashioned term "mistress" though.

    There are those who believe that Wolfowitz is the scourge of those involved in corruption at the world bank, yet his actions in relation to his "bird" smacks of both "corruption" and hypocracy. Not only does this undermine his credibility, but the credibility and status of the World Bank.

    It also shows incredible arrogance on his part and a casual disregard for appropriate behaviour. But this arrogance is so typical of these neo-conservative cultists isn't it? They appear to divide the world into two primary groups, the sheppards and the sheep. The sheppards, due to their towering intellectual abilities can see the world clearly, unadorned, as it really is; not like the sheep, whose brains would melt if they saw the world as it really is, and therefore need to be protected, poor things, from harsh and disturbing reality by the good sheppards.

    Only the sheppards are not particularly enlightened or benign in their relationship to their flocks. They gorge themselves on roast lamb, sleep on piles of sheepskins and rape baby lambs in their huts in the dead of night. And if anyone notices these questionable activities they immediately apologize for their "mistake" and say it's time to move on!

  • Randal

    I hear what you are saying about World Bank corruption, Craig, and I don't disagree.

    But there should be no forgetting and no forgiveness, ever, for the architects of the Iraq catastrophe. For me, that means all the senior members of the US administration who promoted it, and all the members of Blair's cabinet who didn't resign rather than be implicated in it, plus the most guilty and complicit of the senior Blair government functionaries.

    The MPs and US elected representatives who voted for the crime should be treated equally, with the only difference being that there could be forgiveness for them if and only if they provide a suitably full and public apology and admission of error – to include, in my opinion, their signatures to a formal request for war crimes proceedings against the aforementioned architects.

    This is not a matter where "moving on" is appropriate, nor is it something that should be overlooked for domestic political issues. These people have been responsible already for the deaths of maybe a million mostly innocent victims, the maiming of many more, for the effective destruction of a country, for the waste of literally immense amounts of wealth that could have been used for other vital purposes, and all in our name and with the proceeds of our tax payments.

    There should be no hiding place, no excuses and no mitigating arguments for the likes of Blair, Bush, Wolfowitz, Rumsfeld, Feith, Straw, Cheney, Brown, …… The list is long.

  • Randal

    Additionally on Wolfowitz, has a piece suggesting he has used the World Bank as a source of sinecures to reward pro-war Bush regime collaborators. The author names:

    "former Jordanian Deputy Prime Minister Marwan Muasher"

    "former Spanish foreign minister Ana Palacio"

    "former Salvadoran Finance Minister Juan Jose Daboub"

    The piece also states: "Wolfowitz also took with him to the Bank several key right-wing Republican aides – none with any development experience – who had worked closely with him on Iraq-related issues while he was at the Pentagon"

    I have no basis to judge the credibility of this accusation, except to note that this kind of institutional padding is standard practice for ideologues such as Wolfowitz. It simultaneously rewards cronies and increases the institutional influence of the particular ideology. It was a major part of the triumph of left wing ideology through the 20th century.

  • johnf

    The corruption seems to have gone deeper than just his mistress however. He downloaded a whole lot of ideologues from the Bush administration into the WB, giving them also way over the top pay awards:

    ]Separately, two sources told the Financial Times that Xavier Coll, the bank's senior human resources officer, was not consulted over the terms and conditions offered to Robin Cleveland and Kevin Kellems, former Bush administration officials who Mr Wolfowitz brought with him to the bank.

    ]Ms Cleveland and Mr Kellems were given salaries of about $250,000 (?126,000) net of tax – the same amount paid to the highest ranked career bank officials, who typically have 25 years of development experience

    ]World Bank policy is that the president has the authority to make an appointment at any level, but it would be normal for the head of HR to be consulted over the terms of such appointments, two sources told the FT. It is understood that mid-ranking HR officials were consulted over the appointments.

    ]The FT's revelations are potentially damaging because they suggest that irregular processes over appointments under Mr Wolfowitz were not limited to his personal involvement in the Riza affair.

  • NickW

    As ever, the situation is more complex and not as clear-cut as it seems. Wolfowitz was aware that there might be a clash of interests before he even joined the World Bank:

    The bank's general counsel at the time, Roberto Danino, wrote in a May 27, 2005 letter to Mr. Wolfowitz's lawyers:

    "First, I would like to acknowledge that Mr. Wolfowitz has disclosed to the Board, through you, that he has a pre-existing relationship with a Bank staff member, and that he proposes to resolve the conflict of interest in relation to Staff Rule 3.01, Paragraph 4.02 by recusing himself from all personnel matters and professional contact related to the staff member." (Our emphasis here and elsewhere.)…

    Which undermines Writeon's accussation that 'It seems pretty clear that Wolfowitz, did, indeed, use his position to lever a pay increase for his "girlfriend", I think I prefer the old-fashioned term "mistress" though.'

  • writeon

    Writeon returns!

    O.K. I thought this affair was a bit of a laugh, yet another juicy scandal involving the ghastly neo-con, conmen, cultists. But then one finds that some people actually want to defend these creeps! One's talking about murderers here.

    It's almost bizarre. Maybe it won't be the blood and the gore that sticks, stinks and clings to them that brings them down, perhaps it'll be little lies and missteps, that people can understand?

    There's irony in all this. Like Al Capone, who was imprisoned for a relatively unimportant income-tax crime, Woflie may fall not for the rape of Iraq, but because Love drove him to distraction. There would be tragedy in this I suppose, if Wolfie and the rest of the gang-rapists, weren't such tiny, sordid and frankly rather odd figures, when stripped of their emmense power.

    Here, once again the neo-conmen remind one of the towering figures of the Nazi regime. Bloated and egocentric, wildly eccentric, commical, inflated with the putrid gas of their own arrogance. The mighty neo-conmen would almost be worthy of sympathy, if only they weren't so un-worthy, and so steeped in the blood of the defenceless and innocent.

    Wolfie, who, as we all know, is an intellectual giant, shouldn't really be giving cringe-worthy press conferences dessed in a smart business suit, at the World Bank; but, rather he should be banged up sewing mailbags!

    Or maybe the prison library would suit him better?

    Whilst the right-wing US press, like the Wall Street Journal and Fox News are bending over backwards to find excuses for Wolfie and his dangerous dick, their are, unfortunately more serious sides to this subject.

    This problem with his bird, is just the straw that broke the camel's back at the World Bank. Rather than going into tedious detail, let's paint with a broad brush.

    Wolfie irritated lots of people at the bank by turning it into a arm of US foreign policy, which is why he was given the job by Bush in the first place. Next he was the great anti-corruption hero, but he was selective in who and what countries he spied as corrupt. After Uzbekistan asked the US army to leave, suddenly they became suspecious and "corrupt". Wolfie rewarded politicians who had proved their loyalty to the Whitehouse, in the attack on Iraq, with juicy jobs they weren't qualified for, which irritated lots of other people at the bank who saw themselves being pushed aside by amateurs close to Wolfie and his neo-con agenda.

    Even more seriously this whole "anti-corruption" issue is steeped in hypocracy, ideology and politics, once again so typical of the neo-conmen.

    Just like the campaingn against corruption in the UN, the right-wing in the US are using the issue as an excuse to weaken and undermine the World Bank. After they weaken these organizations they are fall easier to control. Sure there's corruption in these organizations, but that's true of many similar organizations.

    But compare the ammount of coverage the UN and the World Bank have received and then look at the biggest corruption scandal in history which involved Wolfie and his friends in the Whitehouse. The billions that have simply disappeared in Iraq. The collosal corruption involved in reconstruction contracts. The massive profits due to huge overcharging for almost everything private companies provide for the occupation forces. I could go on and on, but I won't.

    But this form of corruption isn't being investigated, at least not yet, with anywhere near the same zeal by the right-wing press, because it's our corruption and our guys who are doing it. Then there's the question of Iraq's oil and who's in line for the contracts. So we rape a country and then we start to rob it blind, and then we begin to polish our anti-corruption halo, what a lark this is. The neo-conmen are nothing if not audacious!

    There's a old, old story about the terrible fate that once befell a cruel sheppard that sorely abused his flock, who remained passive and sheeplike, until one dark night…

  • NightWatch


    I'm gaining a whole new respect for you!

    Right on target about the "rather odd figures" in the Nazi club being very much like what we have now. In fact, did you witness the tape of Wolfie saying "I was new on the job..", meaning he should be foregiven his errors in hiring, etc. I sat open mouthed as he said the words only a worm freshly out of school would say in begging to be forgiven. Maybe it was written by a new "worm" on his staff, but that moment said to me everything you said in commenting on the odd Nazi personalities. The man is in his 60's for christs sake!

    War and all the benefits that go with it just seem to be human nature. Taking other peoples stuff and imposing our ideologies seems to be what we do. Everyone on our little anthill seems to have a pre-programmed function.

  • Craig


    What you say about Wolfowitz is absolutely true. But the trouble is that you reach a stage where those of us who believe in the need for international institutions are reluctant to concede ground by admitting they are horribly corrupt, thus leaving the field open to the far right – and ourselves on false ground.

    But I am pleased my attempt to arouse some controversial discussion worked!

    NickW – I think the point is that, having promised to recuse himself from matters affecting his paramour, he then broke his promise and did interfere. He seems to be admitting that.

  • ziz

    What is really distressing is that no matter how good she may be in the sack, she still can't teach the runt to comb his hair properly.

  • NickW

    Craig, my reading is that he became involved after all the appropriate officers and commmittees ad decided that she had to go and then advised Wolfowitz, in his professional capacity, to communicate that decision to the HR V/P.

    From the WSJ article:

    'Five days later, on July 27, ethics committee chairman Ad Melkert formally advised Mr. Wolfowitz in a memo that "the potential disruption of the staff member's career prospect will be recognized by an in situ promotion on the basis of her qualifying record . . ." In the same memo, Mr. Melkert recommends "that the President, with the General Counsel, communicates this advice" to the vice president for human resources "so as to implement" it immediately.'

    So yes, Wolfowitz tecnically went back on is initial recusal – but everyting e subsequently did was on te record and all above board. oever, I'm ultimately aware tat tis won't was wit people wo ate im anyway and just want im gone gone gone. I was initially interested inn Wolfie's decision to cut funding to Uzbekistan – and you know better tan most te absurd negotiations on wic te decision to lend was initially made.

    Iike you, I'm generally a fan of te international organisations – but people are just jumping on te anti-Wolfowitz bandwagon and not really examinning is record in an unjaundiced ligt.

  • NickW

    [sorry – repost – 'h' button on my keyboard bust.]

    Craig, my reading is that he became involved after all the appropriate officers and commmittees ad decided that she had to go and then advised Wolfowitz, in his professional capacity, to communicate that decision to the HR V/P.

    From the WSJ article:

    'Five days later, on July 27, ethics committee chairman Ad Melkert formally advised Mr. Wolfowitz in a memo that "the potential disruption of the staff member's career prospect will be recognized by an in situ promotion on the basis of her qualifying record . . ." In the same memo, Mr. Melkert recommends "that the President, with the General Counsel, communicates this advice" to the vice president for human resources "so as to implement" it immediately.'

    So yes, Wolfowitz technically went back on his initial recusal – but everything he subsequently did was on the record and all above board. Hoever, I'm ultimately aware that this won't wash with people who hate him anyway and just want him gone gone gone. I was initially interested in Wolfie's decision to cut funding to Uzbekistan – and you know better than most the absurd negotiations on which the decision to lend was initially made.

    Iike you, I'm generally a fan of the international organisations – but people are just jumping on the anti-Wolfowitz bandwagon and not really examining his record in an unjaundiced light.

  • Boss

    Good enough posts, and plenty of good enough data, except, the terms of employment of Wolfowitz have not been alluded to.

    As per the terms of contract of his employment, that is despite the contract having been negotiated for Wolfowitz by his lawyer, over a long period, resulting in a detailed list of ''do's, and don'ts''. However remaining bound by the terms of employment, applicable to any employee, in the world bank, which prohibits the employees from fraternising in the biblical fashion with each other.

    Some would say this clause does not apply to Paul seeing as he is one of the 'chosen tribe' guys, hence he just exercised his prerogative and got on with some biblical, null multiplication. On the other hand others would maintain, these supremacists, have very little time for the laws and conventions of the lesser tribes, ergo their serial breaking of all the laws and conventions set thereof. Also remembering that G. W has come out in his support, that basically reiterates; US effectively is an Israeli colony, as Scot Ritter puts it.


    International institutions are horribly corrupt, due to a simple fact; the founders setting such constructs in place were looking for yet another scam angle to get on with some more ruling the roost. However, that does not mean that people cannot be dealing with each other based on a horizontal construct, ie, we have the means, we have the know how, we can rely on local and indigenous wisdom, which gives rise to the question; what are we waiting for?

  • rogilman

    One has to believe that Wolfowitz is hated by World Bank staff for his management style and ties to the Bush Administration, not for "corruption." To me, both the Wolfowitz and the World Bank desevere to swing. But they should do so for their real crimes. In this case it's not altogether clear what's really going on. The other day the woman involved complained that she was the true victim in this affair, that she had been forced to transfer (with her kid) from a job she liked to the State Dept because of a decision by the WB ethics committee. Good point? Perhaps the raise was in effect recompense for time and trouble? I'm not a fan of non-fraternatization rules of this kind, not the least because women usually suffer the most from them, in effect reinforcing existing discrimination. From that standpoint, maybe Wolfowitz was right in helping her. I don't know what he actually did, and it seems that few people care, anyway. It's much easier, more opportune, to slide by the specifics of the matter and use the incident itself for settling scores.

  • writeon

    In theory we can all get lost in the minute detail of what exactly Wolfie did and said, and who wrote what memo's, and the arcane rules of the World Bank, and on and on…

    But as I pointed out with the Al Capone analogy, these kind of powerfel men are often felled by subtle means, not direct confrontation. It's a tactic which avoids a lot of "politics" whilst still removing them or weakening them so severely that they choose to go rather than hang on as neutered leaders.

    Not only in America, but internationally, there is a revolt against the neoconmen and their disasterous and dangerous policies. Wolfie, as one of the chief architects of the disaster has a lot of enemies just waiting to pounce on him for any little "mistake".

    Wolfie and the other neocons have lost the mandate of heaven and therefore have to go. Exactly how they are removed is, relatively speaking, of minor interest to most of us.

    Way back in the old days, when a king had pissed enough people off, he'd go out hunting and have an unfortunate "accident". He'd be gorged by a wild boar, fall from his horse and break his neck, or walk in front of a stray arrow. The important thing was, he wasn't coming home that day. Openly removing a king was difficult, expensive and potentially dangerous for the whole system, so one used subterfuge instead. This is pretty much what's happening to poor Wolfie.

    Finally, it's really wrong to make any kind of reference to Wolfie's ethnic background. He's been involved in more than enough to accuse him ten times over, without one needed to imply that his ethnic origins have any relevance. Such remark's only undermine one's case against the man.

  • richard01

    Michael Moore included a clip of Wolfowitz licking his comb in Fahrenheit 9/11.

    Comment on the Guardian blog on 30 Jan 2007

    He also likes to spit on his comb to have "nicer hair style"…

    But these are only small things compare to his friendship with most corrupt and brutal dictator of Indonesia Mr. Suharto.

    Paul W. is a typical double faced big mouth neo-con dwarf.

    Self-proclaimed warrior against corruption and for democracy is really a disgusting, dishonest and manipulative figure straight from Mordor.

    Posted by Andrzej on January 30, 2007 11:42 PM.

    underneath a photo of the man wearing holey socks in a Turkish mosque, at:

    and another comment:

    I'll bet "Big Brother" Paul will never wear another pair of holey socks in his life. Either that, or he will never forget to cut his toenails.

    How ironic, even comforting, to see an Oz-like man who makes millions of lives more difficult look so pathetically laughable.

    There is a God, after all, and he has a sense of humor!

    Posted by AbleGoodman on January 31, 2007 4:28 AM.

    and another:

    First the comb, now the socks – Wolfowitz is living proof that an erstwhile schlemiel can rise to big macher status. This would be hilarious were it not for the 500,000 dead in Iraq.

    Posted by erikvilius on January 31, 2007 11:15 PM.

    You can't do much about this fellow by following normal, reasonable, rational, or even legal rules in the current American political climate, but you can at least make sure the whole world laughs at him for being such a ridiculous old slob.

    Pity that the Iraqi who fired a rocket into Wolfowitz's hotel during his one visit to the place, missed.

  • johnf

    From the NYT:

    ]The Defense Department directed a private contractor in 2003 to hire Shaha Ali Riza, a World Bank employee and the companion of Paul D. Wolfowitz, then the deputy secretary of defense, to spend a month studying issues related to setting up a new government in Iraq, the contractor said Monday.

    ]The contractor, Science Applications International Corporation, or SAIC, said that it had been directed to hire Ms. Riza by the office of the under secretary for policy. The head of that office at the time was Douglas J. Feith, who reported to Mr. Wolfowitz.

    ]After her trip to Iraq, Ms. Riza briefed members of the executive board of the World Bank on efforts to rebuild after the American invasion and specifically on the status of Iraqi women, according to Ms. Riza's supervisor at the time.

  • Craig


    Thank you. This gets uglier by the minute. As, incidentally, does Ms Riza – I just did a Google image search. I see God got his revenge in first by making them such an ugly couple.

  • johnf

    Yet more filth. From Laura Rozen's web-site:

    >Reader CM:

    >I've been interested in the news today that Victoria Toensing is claiming Ms. Riza to be a volunteer for her trip to Iraq. The Government Accountability Project has put up the contract that SAIC had for this work here:

    >Not so sure why SAIC would need a contract for a volunteer. This contract names Riza and two others as Subject Matter Experts and the total contract is for $235,000. It is for Time and Materials (with the government providing transportation) — even given that SAIC likely took 1/3 of this for overhead, this is a decent amount of money for 90 days of work that does not seem to result in any written reports. …

    Nice work if you can get it.

  • johnf

    .WASHINGTON – A deputy to Paul Wolfowitz urged the World Bank chief on Wednesday to resign in the interests of the institution during a meeting of the bank's management, sources who participated in the meeting said.

    >The sources told Reuters that World Bank Managing Director Graeme Wheeler, a bank veteran named by Wolfowitz as one of his two deputies a year ago, raised the issue at a meeting of the bank's vice presidents.

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