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Tuesday, May 29, 2007

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On the optimistic side of cautious optimism

George W. Bush will put forward former US Trade Representative and Deputy Secretary of State Robert Zoellick to become the next president of the World Bank. The FT's Krishna Guha and Eoin Callan report on the reactions:

Hank Paulson, the US treasury secretary, said he recommended Mr Zoellick to the White House following consultations with the bank’s other shareholder governments. Mr Paulson told the Financial Times: “Bob Zoellick is someone who has a passion for development. He has trust, respect and support from all the regions of the world.”

Mr Paulson said Mr Zoellick would be able to build international consensus and get results. “He has got great energy and enthusiasm – he gets things done.”

Mr Zoellick, 53, a former US trade representative who is a senior official at Goldman Sachs, is a respected internationalist with extensive contacts in Europe, China, Latin America and Africa. He played a prominent role in the peaceful reunification of Germany and led efforts to revive the Doha trade talks round....

Mr Paulson said he did not come under serious pressure to open up the search process during talks with finance and development ministers.

“Even people who said that in theory they favour an open global search said, given the turmoil at the bank, ‘Please find someone who will have global support and can get appointed quickly so we can get the bank focused on its mission again’,” he said

A senior World Bank manager said there would be mixed feelings about Mr Zoellick’s nomination, with respect for his diplomatic skills offset by concern about his hard-driving management style. The manager said Mr Zoellick was “highly regarded” but seen as a “bit abrasive” with his staff.

“I think there is scepticism about Zoellick’s management skills,” he said.

I've heard this last concern voiced by others in the know. To wich I'd say the following:

1) Having seen and interacted with Zoellick in the past month, he strikes me as being on the calmer side of the DC heavyweight spectrum. He's smart, he knows he's smart, and he does not suffer fools gladly. By beltway standards, however, abrasive does not spring to mind.

2) A mix of diplomatic skills and hard-driving management is pretty much the recipe for the World Bank. Although Paul Wolfowitz did not cover himself in glory during his tenure, the Bank staff also acted in a manner that raised a number of red flags about inmates running the asylum. We'll see where the Bank goes from here.

Brad DeLong is pessimistic:

If Robert Zoellick had not served the Bush administration without distinction as Special Trade Representative and as Deputy Secretary of State, I would be enthusiastic about his World Bank President candidacy. But the fact that he has done nothing in his last two government jobs makes me wonder whether an alternative candidate should be found.

In the past, I've disagreed with DeLong about Zoellick on precisely this point. He's a thoroughly competent man who has served a thoroughly incompetent administration. When Zoellick served in a competent administration, he accomplished only some minor things -- like helping to reunify Germany.

Actually, by moving to the bank, Zoellick will provide an ideal "natural experiment" to test out Brad and my takes on him. So I extend the following challenge to DeLong: if, in three years time, Zoellick is judged as having been successful by, say, Ken Rogoff, William Easterly, and Dani Rodrik, DeLong will owe me 100 units of Special Drawing Rights. If they judge him a failure, I'll pay DeLong.

UPDATE: Philip Levy makes the case for Zoellick over at America.com.

posted by Dan on 05.29.07 at 11:18 PM

Comments:

The World Bank presidency cannot be as attractive a job as it was a couple of years ago.

The Bank has always had elements of dysfunction in its culture, not an uncommon thing in international institutions but nevertheless obstacles to its always being as effective as it could be. Its problems cannot all be blamed on Paul Wolfowitz. But a lot of them can; Wolfowitz's personal ethics aside, he was by all accounts a lousy manager who attempted to graft administrative practices accepted in Donald Rumsfeld's Pentagon onto an institution that would not easily have accepted them even had Wolfowitz's aides been knowledgable in the development field.

Though DeLong is wrong about Zoellick's performance as USTR -- not just or even primarily because of the administration Zoellick served but rather because trade liberalization has become much more difficult in recent years -- I was not an admirer of the diplomacy Zoellick conducted in Sudan with respect to Darfur. It is a long story, and began well with a negotiating strategy that could have worked given a substantial amount of good luck. Toward the end of his tenure as Deputy Secretary, though, Zoellick appeared to press for an agreement for agreement's sake. This helped produce the unfortunate Abuja settlement, which settled nothing and has instead prolonged Darfur's agony.

This blot on his record notwithstanding, Zoellick is probably a good choice for the Bank at this time. He would have been a better one two years ago. The main thing he'll be in for in his first year on the job is repairing the damage Wolfowitz did.

posted by: Zathras on 05.29.07 at 11:18 PM [permalink]

We need someone to take a confrontational role with the staff and the board, since cleaning up the cesspool there is more important than the Bank's ostensible mission. In any case, why is the survival of the World Bank in the US national interest? If its head were not by tradition an American, would anyone think that it served any useful purpose for this country? The best one can say for it now is that it is superfluous. Every dollar of US money chaneled through the Bank could instead be used bilaterally to gain leverage for our own objectives, be they developmental or political.

posted by: srp on 05.29.07 at 11:18 PM [permalink]