Paul Wolfowitz’s nomination as president of the World Bank earlier this year met with outrage. The neoconservative’s record as a leading Bush administration advocate for invading Iraq inflamed development experts, most of whom considered the war to be illegal. Anxious Bank staff rifled off 1,300 e-mails within 48 hours to an internal comment line, expressing everything from worries about the institution’s credibility to fears that the appointment of Wolfowitz could incite terrorist attacks on its offices. Officials in Europe, the Bank’s biggest financial backer, reacted with dismay at the choice of the deputy Defense secretary and at the lack of any consultation from Washington. “The way his nomination came across was seen as a provocation,” says one senior European official.
So much for first impressions: After three short months on the job, Wolfowitz is provoking a quick -- and mostly positive -- reassessment by Bank insiders and other erstwhile critics. He played a critical role in forging the recent Group of Eight agreement on aid and debt relief, helping persuade a reluctant Bush administration to agree to compensate the World Bank and the African Development Bank for the loans they will write off under the initiative. He has visited several sub-Saharan countries and issued a blunt call for the U.S. and other rich nations to end their trade-distorting agricultural subsidies. And he has come out forcefully in support of World Bank programs in middle-income countries, which are vital for the organization’s finances but anathema to many U.S. conservatives.
In short, Wolfowitz has shown himself, so far, to be a powerful advocate for the World Bank and its antipoverty mission rather than a tool of U.S. policy. “He certainly has come out on the positive side on a number of issues where there was a high level of anxiety,” says Joseph Stiglitz, a former World Bank chief economist and a frequent critic of the Bush administration.
Wolfowitz’s idealism may have been misplaced at the Pentagon, where he argued that the Iraq war would spark a democratic transformation of the Middle East. But that quality is vital to the World Bank’s development mission. The new president’s idealistic nature, intellect and White House clout are just what the Bank needs after the innovative but often abrasive activism of his predecessor, James Wolfensohn, supporters contend. Indeed, Wolfowitz may have the ability, and the historic opportunity, to become as influential a leader as Robert McNamara, who redeemed his Vietnam-tarred reputation by spearheading a massive expansion of the Bank during the 1970s.
“The value added is to use the presidency as a bully pulpit, leading people in the belief that the billions of poor in the world can defy history and move out of poverty,” says Jessica Einhorn, the former Bank executive who succeeded Wolfowitz as dean of the Paul H. Nitze School of Advanced International Studies at Johns Hopkins University. “His idealism is well placed at the Bank.”
The 61-year-old Washington veteran dismisses his warmonger image as a caricature and points out that he has been involved in development issues for decades, notably as U.S. ambassador to Indonesia during the late 1980s. He promises to advance the work of Wolfensohn, who largely defined his presidency by campaigning against corruption and in favor of good governance and transparency. And he insists he has no agenda to turn the Bank into a blunt instrument for promoting U.S.-style democracy.
“Different organizations have different functions, and the function of this one is poverty reduction,” Wolfowitz tells II in an interview in his 12th-floor office at the Bank’s Washington headquarters. “If you keep asking yourself, ‘Is what we’re doing focused on poverty reduction?’ and if you make some of your compromises with unreformed governments based on whether they’re doing what they should be doing for poverty reduction, then I think you’ll end up in the right place.”
Wolfowitz identifies several priorities for his presidency in the interview:
* Drafting a coherent plan for Africa to channel the increased aid into improvements in living standards. “The real challenge remains,” he says: “Is it possible to get Africa moving and be in a position five or ten years from now where it doesn’t look like unending poverty?”
* Accelerating the Bank’s recent buildup of lending for roads, ports, pipelines and other big infrastructure projects.
* Promoting freer trade as the best way to foster growth in developing countries. “Trade opportunities are the things that allow people to become independent, self-sufficient and produce real growth,” he asserts.
* Supporting greater opportunities for women, an issue he emphasized last month on a visit to South Asia, where the Bank provides textbooks and stipends to increase school enrollment of girls in Pakistan and funds women’s self-help groups in India and Bangladesh. “If you don’t take advantage of the contribution half of your population can make, then your development’s going to be stunted,” he says.
WOLFOWITZ INHERITS THE JOB AT A TIME OF heightened expectations. The astonishing growth of China and India has demonstrated that sound policies and hard work can transform countries that once seemed condemned to misery. That lesson is slowly taking hold in Africa, where a number of nations are enjoying sustained growth for the first time in a generation as a result of political and economic reforms.
Now, inspired by the skillful leadership of U.K. Prime Minister Tony Blair and the passionate advocacy of Live 8 promoters Sir Bob Geldof and Bono, rich countries have agreed to increase aid to Africa by $25 billion a year by 2010. Previous commitments by donor countries should boost aid to the rest of the developing world by another $25 billion annually by 2010. Suddenly, the United Nation’s Millennium Development Goals of halving extreme poverty, reversing the spread of HIV-AIDs and malaria and achieving universal primary education by 2015 seem like more than pipe dreams.
“There is a more can-do attitude than there has ever been in history,” says Amar Bhattacharya, a senior adviser on poverty reduction at the Bank. “We have today more knowledge, more technology and more political will to tackle the problems of development.”
The Bank itself is enjoying a newfound respect, thanks to Wolfensohn’s decadelong stewardship. His willingness to reach out to political and environmental activists and increase transparency were welcomed by the left, while his efforts to fight corruption and measure the impact of Bank lending appeased right-wing critics.
As the leader in promoting today’s development agenda, however, the World Bank faces intense pressure to show clear and quick progress. Wolfowitz will need to hound donor countries to ensure that their aid promises are actually fulfilled and to work with recipient countries to devise credible strategies for spending the money. Even more difficult, he must prove that the new largesse is actually making a difference in the lives of the world’s 4 billion-plus poor. Given previous false dawns in Africa, which has a legacy of waste and corruption, the risk that today’s goodwill could evaporate is never far away.
“The Bank has to be a catalyst and convener and coordinator -- the place where things get pulled together,” says Nicholas Stern, a former World Bank chief economist who wrote the influential report for Blair’s Commission for Africa earlier this year and helped forge the G-8 aid agreement as a top lieutenant to the U.K.'s chancellor of the Exchequer, Gordon Brown. “If we don’t get this right and deliver the extra $50 billion, and if we don’t use it well, we would put the whole development story back for very many years.”
Although Wolfowitz has impressed supporters and skeptics so far, the real test of his presidency is just beginning. His initial challenge is to nail down key details of the G-8 aid agreement. Bank officials hope to win firm commitments from donor countries to compensate the institution for its contribution to the G-8 debt forgiveness plan in time for the annual meetings of the Bank and the International Monetary Fund in Washington later this month. Wolfowitz’s strong advocacy of additionality, as this compensatory funding is known, persuaded many doubters that he was willing and able to defend the Bank’s position. But many leading donors face budgetary problems at home, and countries like Germany and Japan have reservations about debt forgiveness.
The stakes are high for the Bank. The debt plan will deprive it of $1.1 billion in annual repayments to its concessional lending arm, the International Development Association, over the next three years, a figure that reaches $2 billion a year in the next decade. That amounts to roughly 10 percent of IDA’s annual commitments of loans and grants. “Unless you have some clear undertaking that those losses will be made up with money that’s additional to IDA, the deal is meaningless,” says Geoffrey Lamb, vice president for concessional finance.
After securing the Bank’s financing, Wolfowitz must set out clear priorities. He tells II that he wants to intensify the Bank’s renewed emphasis on infrastructure, but he faces competing demands from donor and client countries alike to favor pet projects or sectors. As much as Bank officials enjoy their newfound prominence, they worry about the risk of mission creep. The G-8 summit, for instance, gave the Bank a new mandate to help developing countries cope with climate change, an ambitious and politically charged task. Many officials believe Wolfensohn’s biggest failing was to say yes to all requests, whether from member governments or outside activists.
Wolfowitz “needs to avoid adding new priorities without subtracting any, a mistake sometimes made in the past,” says Caio Koch-Weser, Germany’s state secretary for Finance and a former top Bank official.
The Bank’s plan for Africa, a blueprint for global aid efforts that is due to be unveiled at the annual meetings, highlights some of the difficulties in setting priorities. The Bank wants to ensure that the big increases in aid now planned achieve measurable results in education, health care and other key areas, but officials are reluctant to prescribe detailed proposals because of the Wolfensohn-era ethos that says countries that own their development strategies perform best. As a result, some Bank officials worry privately that the Africa plan will be too vague to provide clear guidance.
Wolfowitz also needs to assemble a cohesive management team to put his stamp on the Bank. He must find a permanent head for the International Finance Corp., the Bank’s commercial lending arm, following the departure of veteran Peter Woicke last year, as well as a new chief financial officer. It’s unclear whether he will seek to replace Shengman Zhang, the Bank’s well-regarded managing director, who has served as an effective chief operating officer for the past eight years. European governments are bidding for one of their own to get the IFC job after abandoning their lobbying for the creation of a No. 2 Bank post similar to that which exists at the IMF.
Unlike his predecessor, who arrived declaring war on the staff in an effort to shake up the Bank, Wolfowitz has made a point of praising his colleagues. On his first day he held a town hall meeting that drew an overflow crowd of several hundred people. Those efforts have erased much of the hostility that greeted his appointment. “There’s still a lot of nervousness, but he has absolutely reached out to staff,” says Alison Cave, head of the Bank’s staff association.
Some Bank executives, however, grumble privately that the new boss can be hard to reach and is too tightly controlled by his minders: Kevin Kellems, a communications adviser Wolfowitz brought from the Pentagon, and Robin Cleveland, a staff assistant who came from the White House’s Office of Management and Budget, where she helped win congressional funding for the Iraq war.
“There continues to be a sense that he’s closeted and hard to get face time with,” one Bank official says of Wolfowitz. Other observers say the president needs to work with senior executives more closely to chart the institution’s course. “The Bank is very much at a point where it has to make choices,” says Masood Ahmed, a former Bank official who helped negotiate the G-8 debt and aid agreement as policy director at the U.K.'s Department for International Development. “If Wolfowitz is going to lead the Bank in making those choices, he’s going to have to get the Bank as a management team more associated with the search for answers.”
WOLFOWITZ GREW UP IN A COMFORTABLE, intellectually challenging environment. Born in Brooklyn, he spent much of his youth in Ithaca, New York, where his father, Jacob, was a mathematics professor at Cornell University. He studied math at Cornell but found his curiosity stimulated more by the softer sciences. A key influence was Allan Bloom, the conservative philosopher who later wrote The Closing of the American Mind, a book that criticized the relativism prevalent in academia and urged a return to such great works of Western thought as Plato’s Republic, which he had translated.
After earning a bachelor’s degree in mathematics and chemistry in 1965, Wolfowitz enrolled as a graduate student of political science at the University of Chicago. He was attracted by the presence of Leo Strauss, a German-born philosopher and mentor to Bloom and a profound influence on many neoconservatives. Strauss criticized relativism and believed governments should promote absolute moral values. He also maintained that leaders should rely on elite teams of advisers, writes James Mann in Rise of the Vulcans, a book about President Bush’s top foreign policy advisers, which labeled Wolfowitz “the most influential underling in Washington.”
A Chicago mentor of more practical importance was Albert Wohlstetter, a political science professor who had studied mathematics with Wolfowitz’s father at Columbia University. Wohlstetter was a leading nuclear strategist who preached the need to maintain U.S. military supremacy through advanced weaponry, a theme Wolfowitz would sound often in his career. Wohlstetter’s fears about the risk of nuclear proliferation in the Middle East helped inspire Wolfowitz’s Ph.D. thesis, which warned that nuclear-powered desalination plants then planned for the region could be used to produce weapons.
Armed with a recommendation from Wohlstetter, Wolfowitz went to Washington in 1969 to join the newly created Committee to Maintain a Prudent Defense Policy. The committee had been founded by Paul Nitze, a veteran arms control negotiator, and Dean Acheson, a former secretary of State, to lobby in favor of building an antiballistic missile system. Wolfowitz joined another Wohlstetter protégé, Richard Perle, in writing research papers for then-senator Henry Jackson, a Democratic backer of the ABM system. Their work “ran rings around the misinformed papers” produced by ABM opponents, Nitze later wrote. They succeeded: The controversial ABM bill passed by a 51-50 vote, with thenvice president Spiro Agnew casting the deciding vote.
From 1970 to 1972, Wolfowitz taught at Yale University; his students included I. Lewis Libby Jr., who became another key advocate for invading Iraq as chief of staff to Vice President Dick Cheney. In 1972, Wolfowitz took a government job as an analyst at the U.S. Arms Control and Disarmament Agency, where he was a behind-the-scenes skeptic about arms control negotiations with the Soviet Union. As a deputy assistant secretary of Defense in the Carter administration, Wolfowitz produced a 1979 study that cited the risk that Iraq might invade Kuwait or Saudi Arabia and warned of the difficulty the U.S. would face in deploying military forces in the region.
After Ronald Reagan entered the White House in 1981, Wolfowitz was appointed head of policy planning at the State Department. He recruited several promising graduate students, including Dennis Ross, who would become Bill Clinton’s Middle East envoy, and Francis Fukuyama, the academic and policy adviser who wrote The End of History and the Last Man.
“He was one of the most intelligent and thoughtful policymakers I have ever met,” says Fukuyama. A board member of the National Endowment for Democracy, which promotes democracy in developing countries, Fukuyama sees Wolfowitz continuing the Bank’s efforts to combat corruption and increase transparency but says he won’t overtly promote democracy. “The Bank simply can’t do that. It has to work with governments,” he notes.
Promoted to undersecretary for East Asian affairs, Wolfowitz worked to engineer a peaceful transition in the Philippines from the U.S.-backed strongman, president Ferdinand Marcos. He met with non-Communist opposition leaders and called for democratic reforms. When the popular uprising known as People Power forced Marcos to flee the country in a U.S. military jet the following year, Wolfowitz helped persuade Reagan to recognize the new government of Corazón Aquino.
Wolfowitz proved more accommodating of authoritarianism in Indonesia, where he served as U.S. ambassador from 1986 to 1989. The administration backed the Suharto regime, and Wolfowitz met often with the Indonesian president, although the ambassador called for a more open political system in his farewell speech. In his interview with II, he contends that Suharto adopted a “B or B+ policy framework” in his early years.
Back at the Defense Department as undersecretary for policy, Wolfowitz helped plan for the first Gulf war and argued unsuccessfully for the removal of Saddam Hussein. He continued to pursue the issue during the Clinton administration; he joined a number of hard-line conservatives, including Perle, Cheney and Donald Rumsfeld, in forming the Project for a New American Century and calling in 1998 for a preemptive strike against Iraq. When he returned to government as deputy Defense secretary in 2001, the September 11 attacks on New York and Washington allowed him to finally win the argument.
At a meeting of top officials at the president’s Camp David retreat only four days after the attacks, Wolfowitz told Bush that the immediate U.S. response should be not only to topple the Taliban in Afghanistan and go after Osama bin-Laden but also to invade Iraq and remove Hussein, whose record of working with terrorists, he asserted, meant there was as much as a 50 percent chance that Iraq was involved in the attacks. Bush didn’t follow that advice straightaway, but ultimately, he accepted the argument that the war on terror should go through Baghdad.
As the most overtly political figure nominated for the World Bank post since McNamara, Wolfowitz was bound to be a controversial choice. His hawkish advocacy of the Iraq war made him loathed by many Bush administration critics and guaranteed that his nomination would spark an outcry. ''A truly terrifying appointment,’' declared David Timms, a spokesman for the World Development Movement, a British lobby group.
Bush’s decision to go public with the nomination before phoning European leaders didn’t help matters. “There was not exactly extensive consultation,” says Germany’s Koch-Weser.
At the urging of his fellow leaders, Prime Minister Jean-Claude Juncker of Luxembourg, then president of the European Union, invited Wolfowitz to meet with EU development and finance ministers and hear their concerns. The March 31 meeting in Brussels went a long way toward breaking the ice.
“Mr. Wolfowitz showed he knew how to listen,” says Xavier Musca, director of the French Treasury. “He didn’t present himself as an American proconsul but as someone who wanted to take into account our preoccupations.” The Europeans argued the case for more development aid, particularly for Africa.
Wolfowitz had other factors in his favor. European leaders had already decided to put differences over Iraq behind them, and they had their own issues to push. German Chancellor Gerhard Schröder was lobbying to win a seat on the U.N. Security Council for his country, while French President Jacques Chirac was seeking to get Pascal Lamy installed as head of the World Trade Organization. Lamy was elected in May and took up the post at the start of this month.
In addition to wooing the Europeans, Wolfowitz sought to win nongovernmental organizations over to his side. The day after his nomination, he telephoned Bono and listened to the U2 singer’s arguments in favor of debt relief and increased aid for Africa. And shortly before taking up his new post in June, he met with the leaders of half a dozen major NGOs. Most were impressed by his thoughtfulness and willingness to listen. Unlike Bush’s other controversial nominee, John Bolton, who was recently named ambassador to the U.N., Wolfowitz made clear he valued the institution he was joining.
Those actions helped overcome most of the initial opposition. But Wolfowitz faced an early test in the run-up to the G-8 summit in Gleneagles, Scotland, in July. Blair was staking his leadership of the group on a proposal to forgive debts of the poorest countries to multilateral agencies like the Bank and the IMF and provide an additional $25 billion a year in development aid for Africa. Momentum built as EU countries formally agreed in May to increase their development aid over the next decade to 0.7 percent of GDP, a long-standing target that only a handful of nations, including Denmark and Luxembourg, currently meet. The big question mark was the United States. The administration hasn’t followed through on Bush’s 2002 pledge at the U.N.'s development summit in Monterrey, Mexico, to provide an additional $5 billion a year in aid, and the U.S. had never subscribed to the 0.7 percent goal.
Blair and Chancellor of the Exchequer Brown pressed their case with Bush, Secretary of State Condoleezza Rice and Treasury Secretary John Snow. Bush didn’t want to snub his closest ally, and Rice believed that a G-8 agreement could help counter negative perceptions about the U.S. in the developing world, officials say. On June 7, just days before G-8 finance ministers would meet in London to thrash out a deal, Bush told Blair at a White House meeting that the U.S. would agree to an aid and debt-relief package.
Amid the diplomatic activity Wolfowitz pressed the British case with Snow and Stephen Hadley, Bush’s national security adviser, among others. “I know enough about this president’s views about Africa and poverty reduction, going back to five or six years ago, to be able to argue with some conviction with people in his government about what I think he wants to see,” he says.
Wolfowitz has also marked out an aggressive stance on trade. During a four-country African tour in his first month in office, he visited a cotton-processing plant in Burkina Faso and called for a reduction of agricultural subsidies by rich nations. The U.S. alone spends some $4 billion a year -- more than Burkina Faso’s entire GDP -- on its 25,000 cotton farmers. The Bank estimates that U.S. and European subsidies deprive West Africa’s 25 million cotton farmers of $250 million a year in income. At the Gleneagles summit Wolfowitz teamed up with U.N. Secretary General Kofi Annan to urge the G-8 to set a date for the elimination of farm subsidies as part of a global trade deal. The summit leaders were noticeably silent on trade, but Wolfowitz vows to keep up the pressure ahead of the WTO ministerial meeting in Hong Kong in December.
“It’s very important for the development community to keep emphasizing how important this trade issue is,” he says.
Such outspokenness has impressed people within and outside the Bank. “This was a guy people worried was too close to the Bush administration, and the first thing he said was, ‘These policies have got to change,’” says James Adams, vice president of operations at the Bank.
Wolfowitz has yet to address a number of important issues, however. In Stiglitz’s view, key litmus tests include whether the Wolfowitz World Bank will help developing countries get around patent rights on AIDS treatments and other drugs and whether it will use its $500 million commitment to Iraq to promote rapid privatization, something the Bank has deemphasized in recent years. “Is he going to be on the side of good policy, or is he going to be on the side of ideology and Bush economics?” Stiglitz asks.
Other officials contend that the real test for Wolfowitz will be to use his influence with the Bush administration while distancing the Bank from controversial U.S. policies. “He will be judged very much by how independent he is from the U.S. administration on controversial issues,’' says Koch-Weser.
Having overcome much of the opposition to his appointment, Wolfowitz needs to put his stamp on the Bank and make some credible gains in the war on poverty, beginning in Africa.
For the first time in a generation, there is guarded optimism about Africa’s prospects. Fifteen countries in sub-Saharan Africa have grown by 5 percent annually or more for the past ten years, two thirds of the region’s countries have held elections in the past five years, and governments increasingly are tackling corruption. The new G-8 package needs to build on that progress and help the region transform itself in the eyes of foreign investors, as many Asian countries have in the past 40 years. “Models are extraordinarily important,” says John Page, the Bank’s chief economist for Africa. “Two or three countries growing at 8 percent, and Africa would be a different place.”
Wolfowitz first has to nail down details of the G-8 agreement to ensure that donors deliver on their pledges. Many African governments want assurances of steady funding before developing large-scale plans for investing in health care, education and infrastructure. ''We need long-term commitment, not just for one or two years,’' says Donald Kaberuka, the former Rwandan Finance minister who took over as head of the African Development Bank this month.
Bank staff say it isn’t yet clear whether countries obtaining debt forgiveness will qualify for a full allocation of funds from the Bank or whether they will be subject to the 20 percent haircut given to delinquent borrowers. And donor countries still have to make good on the G-8 pledge of additional aid to compensate the Bank for loans it will write off. “We need to have some clarity soon so we know how much we can grant,” says Pedro Alba, the Bank’s country director for Rwanda.
The Bank also must develop a coherent strategy for coordinating the global aid effort or risk seeing much of the new money squandered by national aid agencies favoring their own pet projects. “The Bank has to move away from being a large lender to being an agency that sets the framework in which development assistance is provided,” says British development official Ahmed. “Most of this money runs the risk of going into bilateral assistance or into vertical projects like the global fund for health.”
Wolfowitz has already marked infrastructure as a top priority: specifically, cross-border roads, railways and energy projects that can help foster African growth and trade. Opposition from environmental and political activists forced the Bank to slash its lending for such projects in the 1990s, but officials have begun putting a fresh emphasis on infrastructure in the past two to three years. The Bank expects to commit some $7.5 billion to infrastructure this year -- nearly 40 percent of its total loans and grants -- and aims to expand its commitments by $1 billion a year for the next few years.
Wolfowitz has asked Katherine Sierra, the Bank’s vice president in charge of infrastructure, to distill some of the lessons the Bank has learned from its infrastructure work over the past two decades and to demonstrate that officials are successfully applying those lessons. As with much of the Bank’s development work, however, there are no simple answers. Earlier this decade the organization helped finance a $2.2 billion, 1,070-kilometer pipeline to carry oil from fields in southern Chad to the coast of Cameroon under a novel arrangement that requires most of the revenues to be spent on specific health, education and infrastructure projects, but the pipeline’s oversight committee reported that many of those projects suffered from delays, poor quality and a lack of competitive bidding.
“The question is, Will revenues reach back into the communities?” says Sierra. “Nothing’s without risk, but if this arrangement doesn’t work, I don’t know what will.”
Elsewhere, Wolfowitz says he is committed to maintaining the Bank’s role in middle-income countries, reassuring Bank officials and European governments who feared he might follow the advice of Allan Meltzer, the professor of political economy and public policy at Carnegie Mellon University who recommended that the Bank withdraw from such countries in a 2001 report to the U.S. government that proposed radical changes to the Bank and the IMF. The new chief’s reasoning is clear. For all their rapid growth and access to capital markets, middle-income countries like China and India still are home to 70 percent of the world’s poorest people, who live on less than $1 a day. China looks to the Bank as much for its expertise as for its $1.5 billion a year in loans (see story, page 98). For the Bank, meanwhile, profits on lending to middle-income states help finance $400 million a year in transfers to desperately poor countries.
The Bank may need to innovate to maintain its relevance for middle-income countries, which increasingly can tap the capital markets for low-cost funds without the hassle and delay involved in working with the World Bank. The Bank should consider creating lower-cost borrowing products for richer developing countries and making loans to nonsovereign borrowers, contends Nancy Birdsall, head of the Center for Global Development, a Washington think tank. Those would be radical departures from the Bank’s policy of lending only to governments on one-size-fits-all terms, but such steps may be needed to help the Bank compete, she says.
“It will take some strong leadership to corral the shareholders to agree to new products and a new vision of the role of the Bank,” says Birdsall. Operations chief Adams sees a lot of room for lending to nonsovereigns -- municipalities or utilities without a government guarantee, for example. “We see a lot of entities that are potentially investment grade,” he says. “There are multiple billions in business out there.”
Perhaps the trickiest issue for Wolfowitz will be his newest mandate, to help the developing world tackle climate change. At the G-8, Blair persuaded Bush to agree to seek ways of reducing greenhouse gas emissions, combating pollution and enhancing energy security, but huge differences remain between European countries, which believe that Kyoto-like targets are the best way to proceed, and Washington, which rejects targets in favor of market-led solutions.
Robert Watson, the Bank’s chief scientist on climate change, hopes to avoid the polemics over targets by focusing on the long term. He notes that the average power plant can last as long as 50 years, far beyond the Kyoto Protocol’s 2012 target date for reducing greenhouse emissions. The Bank has set up working groups on technologies for coping with climate change, financing mechanisms to diffuse those technologies and helping poor countries’ agricultural industries and coastal communities adapt to climate change. “Our job is not to take sides. Our job is to move the issue forward,” says Watson.
Good luck, say the Bank’s backers. Most shareholders welcome the new initiative and point out that the Bank helped create the global market for trading carbon emissions. But the G-8 mandate may become a lightning rod for fresh attacks from American conservatives.
“It makes the Bank more controversial, but I have no doubt it’s the future,” says Germany’s Koch-Weser.
Much the same could be said of Wolfowitz. If he maintains his early performance, the future of the Bank -- and the global war on poverty -- could be bright indeed.
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