World Bank Stitch-Up to Continue

When it comes to cozy duopolists, any future friendliness between Thomson-Reuters and Bloomberg pales next to the selfishness and nearsightedness of the G2 when it comes to leading the World Bank and the IMF. No sooner had Paul Wolfowitz resigned than Hank Paulson was telling PBS that his replacement would be chosen by the Americans, and it wasn't long until the Germans chimed in too:

German Chancellor Angela Merkel's spokesman today rejected a suggestion by Finance Minister Peer Steinbrueck that the U.S. should consider giving up its lock on the World Bank presidency.
"For the German government, it's completely beyond all question that the United States of America will continue to occupy the top job at the World Bank and has the first choice," spokesman Thomas Steg said at a press conference in Berlin today.

What's fascinating to me is that no one seems to be spending any time drawing the distinction between America nominating the next president, on the one hand, and it nominating an American, on the other. For reasons I genuinely don't understand, it seems to be some kind of inviolable rule that if the US has the privilege of choosing the next president, it will always choose an American citizen.

Never mind that the result of such idiocies is that you end up with people like Jim Wolfensohn actually taking US citizenship for no other reason than to become World Bank president. (Note to self: Ngozi Okonjo-Iweala has lived in America since 1972, and her children are American; could she do the same thing?) The bigger point is that it's trivially true that America's best interests are not necessarily served by having an American in the top job -- even assuming that the White House is so selfless as to be trying to serve its own best interests here, rather than those of the world's poor.

Even if the Americans do show the imagination necessary to nominate a non-American, however, the process remains fundamentally flawed. As dsquared notes in a comment on this blog,

Going in for rushed and non-transparent selection was how we got into this mess in the first place. Replacing Wolfowitz has to be used as the opportunity to put in place a proper selection process. The WB can function without a President for a short while, but it can't go on without big changes to the top job system. I would be much keener to see an interim appointment of one of his deputies (or even a real steady-the-ship exercise, appointing someone like Michel Camdessus pro tem) and taking the opportunity for some real sensible long term thinking about how to fill these jobs (which would obviously have to chuck the IMF top job into the pot too as it is only pure chance that this broken system happened to have its first meltdown at the WB rather than IMF).

The only thing I'd add to that is that the IMF top job (managing director) -- which always goes to a European -- is balanced out somewhat by the IMF number-two job (first deputy managing director) who is in many ways more important, on a day-to-day basis, and who is, naturally, an American.

I'm not at all sure what a proper selection process would look like, although there's no doubt that it would give great weight to the views of the developing world. But I do know that just about any process would be better than what we have now, which is no process at all.